Delaware |
6770 |
46-5723951 |
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(State
or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
David Alan Miller, Esq. Jeffrey M. Gallant, Esq. Graubard Miller The Chrysler Building 405 Lexington Avenue New York, New York 10174 (212) 818-8800 (212) 818-8881 Facsimile |
Douglas S. Ellenoff, Esq. Stuart Neuhauser, Esq. Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, NY 10105 (212) 370-1300 (212) 370-7889 Facsimile |
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Large
accelerated filer o |
Accelerated filer o |
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Non-accelerated filer þ (Do not check if a smaller reporting company) |
Smaller reporting company o |
Title of each Class of Security being registered |
Proposed Maximum Aggregate Offering Price(1) |
Amount of Registration Fee |
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Units, each
consisting of one share of common stock, par value $0.0001, and one Redeemable Warrant to purchase three fourths (3/4) of a share of common
stock(2)(4) |
$ | 115,000,000 | $ | 14,812 | ||||||
Common Stock
included as part of the Units(2)(4) |
| | ||||||||
Redeemable
Warrants included as part of the Units(2)(4) |
| | ||||||||
Total
|
$ | 115,000,000 | $ | 14,812 | (3) |
(1) |
Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o). |
(2) |
Includes Units and shares of Common Stock and Warrants underlying such Units which may be issued on exercise of a 45-day option granted to the Underwriters to cover over-allotments, if any. |
(3) |
The filing fee has previously been paid. |
(4) |
Pursuant to Rule 416, there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from stock splits, dividends or similar transactions. |
PRELIMINARY
PROSPECTUS |
SUBJECT TO COMPLETION, JANUARY 21, 2015 |
Public Offering Price |
Underwriting Discount and Commissions(1) |
Proceeds, Before Expenses, to Us |
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---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Per unit
|
$ | 10.00 | $ | 0.5325 | $ | 9.4675 | ||||||||
Total
|
$ | 100,000,000 | $ | 5,325,000 | $ | 94,675,000 |
(1) |
Includes up to $0.30 per unit, or up to $3,000,000, as a deferred underwriting fee to be placed in the trust account described below. These funds will be released only on completion of our initial business combination, as described in this prospectus. Please see the section titled Underwriting for further information relating to the underwriting arrangements agreed to between us and the underwriters in this offering. |
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F-1 |
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we, us or our company refers to Harmony Merger Corp.; |
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initial stockholders refer to all of our stockholders immediately prior to the date of this prospectus, including all of our officers and directors to the extent they hold such shares; |
|
insider shares refer to the 3,026,250 shares of common stock held by our initial stockholders prior to this offering, including up to an aggregate of 382,500 shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, after giving effect to a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock effectuated in November 2014; |
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management team or our management refer to our officers and directors; |
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private units refer to the units we are selling privately to our initial stockholders upon consummation of this offering and references to private shares refer to the shares of common stock included within the private units; |
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the term public stockholders means the holders of the shares of common stock which are being sold as part of the units in this public offering, or public shares (whether they are purchased in the public offering or in the aftermarket), including any of our initial stockholders to the extent that they purchase such shares; and |
|
the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. |
Securities
offered |
10,000,000 units, at $10.00 per unit, each unit consisting of one share of common stock and one redeemable warrant, each warrant to purchase
three-fourths (3/4) of a share of common stock at a price of $11.50 per full share subject to adjustment as described in this
prospectus. |
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We
structured each warrant to be exercisable for three-fourths of one share of our common stock, as compared to warrants issued by some other similar
companies which are exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of a business combination
as compared to units that each contain a warrant to purchase one whole share. We believe this will make us a more attractive merger partner for target
businesses compared to companies whose unit structure contains a warrant to purchase more than three-fourths of a share of common stock. However, no
fractional shares will be issued upon exercise of the warrants. Accordingly, unless you acquire at least four warrants, you will not be able to receive
shares upon exercise of your warrants. This unit structure may cause our units to be worth less than if they included a warrant to purchase one full
share. |
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Listing of our
securities and proposed symbols |
We
anticipate the units, and the common stock and warrants once they begin separate trading, will be listed on Nasdaq under the symbols HRMNU,
HRMN and HRMNW, respectively. |
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We
have agreed with Cantor Fitzgerald & Co. that each of the shares of common stock and warrants may trade separately ten business days following the
earlier to occur of the expiration of the underwriters over-allotment option, its exercise in full or the announcement by the underwriters of
their intention not to exercise all or any remaining portion of the over-allotment option. In no event will Cantor Fitzgerald & Co. allow separate
trading of the common stock and warrants until we file an audited balance sheet reflecting our receipt of the gross proceeds of this
offering. |
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Once
the common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the
component pieces. Holders will need to have their brokers contact our transfer agent in order to separate the units into separately trading common
stock and warrants. |
We
will file a Current Report on Form 8-K with the SEC, including an audited balance sheet, promptly after the consummation of this offering, which is
anticipated to take place three business days from the date the units commence trading. The audited balance sheet will reflect our receipt of the
proceeds from the exercise of the over-allotment option if the over-allotment option is exercised on the date of this prospectus. If the over-allotment
option is exercised after the date of this prospectus, we will file an amendment to the Form 8-K or a new Form 8-K to provide updated financial
information to reflect the exercise of the over-allotment option. We will also include in the Form 8-K, or amendment thereto, or in a subsequent Form
8-K, information relating to the separate trading of the common stock and warrants. |
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Common
Stock: |
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Number
outstanding before this offering |
3,026,250 shares1 |
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Number to be
outstanding after this offering and sale of private units |
13,218,750 shares2 |
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Redeemable
Warrants: |
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Number
outstanding before this offering |
0
warrants |
|||||
Number to be
outstanding after this offering and sale of private units |
10,575,000 warrants |
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Exercisability |
Each
warrant is exercisable for three-fourths of one share of common stock. Because the warrants may only be exercised for whole numbers of shares, unless
you acquire at least four warrants, you will not be able to receive shares upon exercise of your warrants. |
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Exercise
price |
$11.50 per whole share. Except as described elsewhere in this prospectus, no warrants will be exercisable for cash unless we have an effective
and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such
shares of common stock. It is our current intention to have an effective and current registration statement covering the shares of common stock
issuable upon exercise of the warrants and a current prospectus relating to such shares of common stock in effect promptly following consummation of an
initial business combination. Notwithstanding the foregoing, if a registration statement covering the shares of common stock issuable upon exercise of
the warrants is not effective within 90 days following the consummation of our initial business combination, warrant holders may, until such time as
there is an effective registration statement and during any period |
1 |
This number includes an aggregate of up to 382,500 shares of common stock held by our initial stockholders that are subject to forfeiture if the over-allotment option is not exercised by the underwriters in full. |
2 |
Assumes the over-allotment option has not been exercised and an aggregate of 382,500 shares of common stock held by our initial stockholders have been forfeited. |
when
we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from
registration under the Securities Act. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares
of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied
by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The
fair market value shall mean the average reported last sale price of the shares of common stock for the 10 trading days ending on the day
prior to the date of exercise. If an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless
basis. |
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Exercise
period |
The
warrants will become exercisable on the later of 30 days after the completion of an initial business combination and 12 months from the date of this
prospectus. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of our completion of an initial business combination,
or earlier upon redemption. |
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Redemption |
We
may redeem the outstanding warrants (excluding the warrants underlying the private units so long as they are held by the initial purchasers or their
permitted transferees), in whole and not in part, at a price of $0.01 per warrant: |
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at any time while the warrants are exercisable, |
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upon a minimum of 30 days prior written notice of redemption, |
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if, and only if, the last sales price of our shares of common stock equals or exceeds $21.00 per share for any 20 trading
days within a 30 trading day period ending three business days before we send the notice of redemption, and |
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if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying
such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of
redemption. |
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If
the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the
scheduled redemption date. However, the price of the shares of common stock may fall below the $21.00 trigger price as well as the $11.50 warrant
exercise price after the redemption notice is issued. |
The
redemption criteria for our warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial
exercise price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price
declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the
warrants. |
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If we
call the warrants for redemption as described above, we will have the option to require all holders that wish to exercise warrants to do so on a
cashless basis. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common
stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the
difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The
fair market value shall mean the average reported last sale price of the common stock for the 10 trading days ending on the third trading
day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether we will exercise our option to require all holders
to exercise their warrants on a cashless basis will depend on a variety of factors including the price of our common stock at the time the
warrants are called for redemption, our cash needs at such time and concerns regarding dilutive share issuances. |
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Amendment |
The
warrant agreement governing the warrants provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity
or correct any defective provision. Additionally, the warrants may be amended, by written consent or vote, of the holders of 65% of the then
outstanding warrants (including the warrants underlying the private units and any other warrants we may issue after the date of this prospectus) in
order to make any change that adversely affects the interests of the warrant holders. |
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Offering
proceeds to be held in trust |
$96,250,000 of the net proceeds of this offering (or $111,250,000 if the over-allotment option is exercised in full), plus the $5,750,000 (or
$6,050,000 if the over-allotment option is exercised in full) we will receive from the sale of the private units, for an aggregate of $102,000,000 (or
an aggregate of $117,300,000 if the over-allotment option is exercised in full), or $10.20 per unit sold to the public in this offering will be placed
in a trust account in the United States maintained by Continental Stock Transfer & Trust Company, acting as trustee pursuant to an agreement to be
signed on the date of this prospectus. The remaining $750,000 of net |
proceeds of this offering will not be held in the trust account. |
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Except as set forth below, the proceeds in the trust account will not be released until the earlier of the completion of an initial business
combination within the required time period or our entry into liquidation if we have not completed a business combination in the required time period.
Therefore, unless and until an initial business combination is consummated, the proceeds held in the trust account will not be available for our use
for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the
negotiation of an agreement to acquire a target business. |
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Notwithstanding the foregoing, there can be released to us from the trust account any interest earned on the funds in the trust account that
we need to pay our income or other tax obligations. With this exception, expenses incurred by us may be paid prior to a business combination only from
the net proceeds of this offering not held in the trust account (estimated to initially be $750,000); provided, however, that in order to meet our
working capital needs following the consummation of this offering if the funds not held in the trust account are insufficient, our initial
stockholders, officers and directors or their affiliates may, but are not obligated to, loan us funds, from time to time or at any time, in whatever
amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would either be paid upon
consummation of our initial business combination, without interest, or, at the lenders discretion, up to $500,000 of the notes may be converted
upon consummation of our business combination into additional private units at a price of $10.00 per unit (which, for example, would result in the
holders being issued 50,000 shares of common stock and 50,000 warrants to purchase 37,500 shares if $500,000 of notes were so converted). Our initial
stockholders have approved the issuance of the units (and underlying securities) upon conversion of such notes, to the extent the holder wishes to so
convert them at the time of the consummation of our initial business combination. If we do not complete a business combination, the loans would not be
repaid. |
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Limited
payments to insiders |
Prior
to the consummation of a business combination, there will be no fees, reimbursements or other cash payments paid to our initial stockholders, officers,
directors or their affiliates prior to, or for any services they render in order to effectuate, the consummation of a business combination (regardless
of the type of transaction that it is) other than: |
repayment at the closing of this offering of a $50,000 non-interest loan made by Eric S. Rosenfeld, our chairman and chief
executive officer; |
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payment of $12,500 per month to Crescendo Advisors II, LLC, an entity controlled by Mr. Rosenfeld, for office space and
related services; and |
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reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on our behalf, such as
identifying and investigating possible business targets and business combinations. |
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There
is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available
proceeds not deposited in the trust account, such expenses would not be reimbursed by us unless we consummate an initial business combination. Our
audit committee will review and approve all reimbursements and payments made to any initial stockholder or member of our management team, or our or
their respective affiliates, and any reimbursements and payments made to members of our audit committee will be reviewed and approved by our Board of
Directors, with any interested director abstaining from such review and approval. |
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Stockholder
approval of initial business combination |
In
connection with any proposed initial business combination, we will seek stockholder approval of such initial business combination at a meeting called
for such purpose at which stockholders may seek to have their shares converted, regardless of whether they vote for or against the proposed business
combination, for a pro rata share of the aggregate amount then on deposit in the trust account less any taxes then due but not yet paid (such
conversion amount initially anticipated to be $10.20 per share). However, the conversion price could be reduced by claims of creditors or if we
increase the size of this offering, each as described in more detail in this prospectus. |
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We
will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation and a majority of
the outstanding shares of common stock voted are voted in favor of the business combination. We have determined not to consummate any business
combination unless we have net tangible assets of at least $5,000,001 upon such consummation in order to avoid being subject to Rule 419 promulgated
under the Securities Act. |
Our
initial stockholders have agreed (i) to vote their insider shares, private shares and any public shares purchased in or after this offering in favor of
any proposed business combination and (ii) not to convert any insider shares or private shares in connection with a stockholder vote to approve a
proposed initial business combination. As a result, we would need only 3,390,626 of the 10,000,000 public shares sold in this offering to be voted in
favor of a transaction in order to have such transaction approved (assuming the over-allotment option is not exercised). However, one of our initial
stockholders has indicated an intention to purchase 720,000 units in this offering. If it purchased such shares, we would only need 2,670,626
additional public shares to vote in favor of the transaction in order to have it approved. Additionally, Eric S. Rosenfeld, our Chief Executive
Officer, has agreed to enter into an agreement in accordance with the guidelines of Rule 10b5-1 of the Exchange Act, pursuant to which he will place
limit orders for an aggregate of up to $500,000 of our common stock as described in more detail in this prospectus. Any buyback shares purchased by Mr.
Rosenfeld pursuant to this arrangement will be voted in favor of the proposed business combination, thereby further reducing the number of public
shares needed to be voted in favor of a business combination to have it approved. Moreover, if a significant number of stockholders vote, or indicate
an intention to vote, against a proposed business combination, our officers, directors, initial stockholders or their affiliates could purchase shares
in the open market or in private transactions in order to influence the vote. There is no limit on the amount of shares that may be purchased by the
initial stockholders. Any purchases would be made in compliance with federal securities laws, including the fact that all material information will be
made public prior to such purchase, and no purchases would be made if such purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act,
which are rules designed to stop potential manipulation of a companys stock. |
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Conversion
rights |
In
connection with any stockholder meeting called to approve a proposed initial business combination, each public stockholder will have the right,
regardless of whether he is voting for or against such proposed business combination, to have his shares converted into a pro rata share of the trust
account upon consummation of the business combination. However, we will consummate our initial business combination only if we have net tangible assets
of at least $5,000,001 upon such consummation. As a result, we will not be able to consummate an initial business combination if the
value |
of
the shares being sought to be converted reduces our net tangible value below $5,000,001. Additionally, in connection with any proposed business
combination, a target business could impose a working capital closing condition or require us to have a minimum amount of funds available from the
trust account upon consummation of such initial business combination. As a result, this may limit the number of shares that we can have converted and
still consummate such business combination. |
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As
indicated above, our initial stockholders have agreed not to convert any insider shares or private shares for a pro rata portion of the funds in the
trust account in connection with a stockholder vote to approve a proposed initial business combination. Additionally, each initial stockholder other
than NPIC Limited, DKU 2013 LLC, The K2 Principal Fund L.P. and Covalent Capital Partners Master Fund, L.P. has agreed not to convert any public shares
(including in the case of Mr. Rosenfeld, any buyback shares he purchases) they hold for a pro rata portion of the funds in the trust account in
connection with a stockholder vote to approve a proposed initial business combination. NPIC Limited, DKU 2013 LLC, The K2 Principal Fund L.P. and
Covalent Capital Partners Master Fund, L.P. would be allowed to convert any public shares they purchase in this offering or in the aftermarket for a
pro rata portion of the funds in the trust account in connection with a stockholder vote to approve a proposed initial business
combination. |
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Notwithstanding the foregoing, a public stockholder, together with any affiliate of his or any other person with whom he is acting in concert
or as a group (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from seeking conversion rights with respect to 20% or
more of the shares of common stock sold in this offering. Accordingly, all shares purchased by a holder in excess of 20% of the shares sold in this
offering will not be converted for cash. We believe this restriction will prevent an individual stockholder or group from accumulating
large blocks of shares before the vote held to approve a proposed business combination and attempt to use the redemption right as a means to force us
or our management to purchase its shares at a significant premium to the then current market price. By restricting a stockholders ability to
convert more than 20% of the shares of common stock sold in this offering, we believe we have limited the ability of a small group of stockholders to
unreasonably attempt to block a transaction which is favored by our other public stockholders. |
We
may also require public stockholders, whether they are a record holder or hold their shares in street name, to either tender their
certificates to our transfer agent at any time through the vote on the business combination or to deliver their shares to the transfer agent
electronically using Depository Trust Companys DWAC (Deposit/Withdrawal At Custodian) System, at the holders option, in order to have their
shares converted. The requirement for physical or electronic delivery prior to the meeting ensures that a holders election to convert his shares
is irrevocable once the business combination is approved. There is a nominal cost associated with this tendering process and the act of certificating
the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker $45 and it would be up to the
broker whether or not to pass this cost on to the converting holder. |
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If
the business combination is not consummated for any reason, public stockholders will not be entitled to have their shares converted. Public
stockholders who convert their shares will continue to have the right to exercise any warrants they may hold if the business combination is
consummated. |
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Liquidation if
no business combination |
If we
are unable to complete our initial business combination within 24 months from the consummation of this offering, we will (i) cease all operations
except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the
outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive
further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject
to the approval of our remaining holders of common stock and our board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii)
above) to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. |
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In
connection with our redemption of 100% of our outstanding public shares for a portion of the funds held in the trust account, each holder will receive
a full pro rata portion of the amount then in the trust account, plus any pro rata interest earned on the funds held in the trust account and not
previously released to us to pay our taxes payable on such funds (subject in each case to our obligations under Delaware law to provide for claims of
creditors). Holders of warrants will receive no proceeds in connection with the liquidation with respect to such warrants, which will expire
worthless. |
We
may not have funds sufficient to pay or provide for all creditors claims. Although we will seek to have all third parties (including any vendors
or other entities we engage after this offering) and any prospective target businesses enter into valid and enforceable agreements with us waiving any
right, title, interest or claim of any kind in or to any monies held in the trust account, there is no guarantee that they will execute such
agreements. In the event that a potential contracted party was to refuse to execute such a waiver, we will execute an agreement with that
entity only if our management first determines that we would be unable to obtain, on a reasonable basis, substantially similar services or
opportunities from another entity willing to execute such a waiver. Examples of instances where we may engage a third party that refused to
execute a waiver would be the engagement of a third party consultant who cannot sign such an agreement due to regulatory restrictions,
such as our auditors who are unable to sign due to independence requirements, the underwriters, who have not waived their rights to
indemnification provided by us under the underwriting agreement, or other third parties whose particular expertise or skills are believed by
management to be superior to those of other consultants that would agree to execute a waiver or a situation in which management does not believe
it would be able to find a provider of required services willing to provide the waiver. There is also no guarantee that the third parties
would not challenge the enforceability of these waivers and bring claims against the trust account for monies owed them. |
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The
holders of the insider shares and private units will not participate in any redemption distribution with respect to their insider shares, private
shares or warrants underlying the private units. |
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If we
are unable to conclude our initial business combination and we expend all of the net proceeds of this offering not deposited in the trust account,
without taking into account any interest earned on the trust account, we expect that the initial per-share redemption price will be approximately
$10.20. The proceeds deposited in the trust account could, however, become subject to claims of our creditors that are in preference to the claims of
our stockholders. In addition, if we are forced to file a bankruptcy case or an involuntary bankruptcy case is filed against us that is not dismissed,
the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the
claims of third parties with priority over the claims of our stockholders. Therefore, the actual per-share redemption price may be less than $10.20.
Although the |
anticipated redemption price could be reduced if we were to increase the size of this offering as described in more detail in this prospectus,
we have agreed with Cantor Fitzgerald & Co., as representative for the underwriters, that we will not increase the size of this offering unless (i)
the initial stockholders agree to purchase additional private units in the private placement, or (ii) the underwriters defer a larger portion of the
underwriting discount, such that at least $10.20 per share sold to the public in this offering is held in trust. |
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We
will pay the costs of any subsequent liquidation from our remaining assets outside of the trust account. If such funds are insufficient, Eric S.
Rosenfeld, our Chairman and Chief Executive Officer, has agreed to pay the funds necessary to complete such liquidation (currently anticipated to be no
more than approximately $15,000) and has agreed not to seek repayment for such expenses. |
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Insider
Indemnification |
Eric
S. Rosenfeld has agreed that he will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a
prospective target business with which we have discussed entering into a transaction agreement, reduces the amount of funds in the trust account to
below $10.20 per public share, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account
and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the
Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, Mr. Rosenfeld will not be
responsible to the extent of any liability for such third party claims. Furthermore, he will not be personally liable to our public stockholders and
instead will only have liability to us. We have not independently verified whether Mr. Rosenfeld has sufficient funds to satisfy his indemnity
obligations and, therefore, Mr. Rosenfeld may not be able to satisfy those obligations. We have not asked Mr. Rosenfeld to reserve for such
eventuality. We believe the likelihood of Mr. Rosenfeld having to indemnify the trust account is limited because we will endeavor to have all vendors
and prospective target businesses as well as other entities execute agreements with us waiving any right, title, interest or claim of any kind in or to
monies held in the trust account. Nevertheless, if we liquidate, the per-share distribution from the trust account could be less than approximately
$10.20 due to claims or potential claims of creditors. |
May 31, 2014 |
September 30, 2014 |
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---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Actual |
Actual |
As Adjusted |
|||||||||||||
Balance
Sheet Data: |
|||||||||||||||
Working
capital (deficiency) |
$ | 2,007 | $ | (74,457 | ) | $ | 99,773,905 | (2) | |||||||
Total assets
|
97,485 | 104,705 | 102,773,905 | (3) | |||||||||||
Total
liabilities |
72,978 | 80,800 | 3,000,000 | (4) | |||||||||||
Value of
common stock subject to possible conversion |
0 | 0 | 93,999,989 | (5) | |||||||||||
Stockholders equity |
24,507 | 23,905 | 5,773,916 |
May 31, 2014 |
September 30, 2014 |
||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Actual |
Actual |
As Adjusted |
|||||||||||||
Income
Statement Data: |
|||||||||||||||
Revenue
|
$ | 0 | $ | 0 | $ | 0 | |||||||||
Net loss
|
(493 | ) | (1,095 | ) | (1,095 | ) | |||||||||
Basic and
diluted net loss per share |
(0.00 | ) | (0.00 | ) | (0.00 | ) |
(1) |
Includes the proceeds to be received from this offering as the offering is being made on a firm commitment basis and therefore the underwriters are obligated to purchase the units on the date of this prospectus. Also includes the $5,750,000 we will receive from the sale of the private units. |
(2) |
The as adjusted working capital is derived by adding total stockholders equity and the value of the common stock subject to possible conversion less up to $3,000,000 of deferred underwriting commissions. |
(3) |
The as adjusted total assets is derived by adding total stockholders equity and the value of common stock subject to possible conversion. |
(4) |
The as adjusted liabilities represents up to $3,000,000 of deferred underwriting commissions. |
(5) |
The as adjusted value of common stock subject to possible conversion is derived by taking 9,215,685 shares of common stock which may be converted, representing the maximum number of shares that may be converted while maintaining at least $5,000,001 in net tangible assets after the offering, multiplied by a conversion price of $10.20. |
|
may significantly reduce the equity interest of investors in this offering; |
|
may subordinate the rights of holders of common stock if we issue preferred stock with rights senior to those afforded to our common stock; |
|
may cause a change in control if a substantial number of shares of common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and |
|
may adversely affect prevailing market prices for our shares of common stock. |
|
default and foreclosure on our assets if our profits after a business combination are insufficient to repay our debt obligations; |
|
acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
|
our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; and |
|
our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding. |
|
a limited availability of market quotations for our securities; |
|
reduced liquidity with respect to our securities; |
|
a determination that our shares of common stock are penny stock which will require brokers trading in our shares of common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our shares of common stock; |
|
a limited amount of news and analyst coverage for our company; and |
|
a decreased ability to issue additional securities or obtain additional financing in the future. |
|
solely dependent upon the performance of a single business, or |
|
dependent upon the development or market acceptance of a single or limited number of products, processes or services. |
|
restrictions on the nature of our investments; and |
|
restrictions on the issuance of securities. |
|
registration as an investment company; |
|
adoption of a specific form of corporate structure; and |
|
reporting, record keeping, voting, proxy, compliance policies and procedures and disclosure requirements and other rules and regulations. |
|
the history and prospects of companies whose principal business is the acquisition of other companies; |
|
prior offerings of those companies; |
|
our prospects for acquiring an operating business at attractive values; |
|
our capital structure; |
|
an assessment of our management and their experience in identifying operating companies; and |
|
general conditions of the securities markets at the time of the offering. |
|
rules and regulations or currency redemption or corporate withholding taxes on individuals; |
|
tariffs and trade barriers; |
|
regulations related to customs and import/export matters; |
|
longer payment cycles; |
|
inflation; |
|
economic policies and market conditions; |
|
unexpected changes in regulatory requirements; |
|
challenges in managing and staffing international operations; |
|
tax issues, such as tax law changes and variations in tax laws as compared to the United States; |
|
currency fluctuations; |
|
challenges in collecting accounts receivable; |
|
cultural and language differences; |
|
protection of intellectual property; and |
|
employment regulations. |
|
ability to complete our initial business combination; |
|
limited operating history; |
|
success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; |
|
potential ability to obtain additional financing to complete a business combination; |
|
pool of prospective target businesses; |
|
the ability of our officers and directors to generate a number of potential investment opportunities; |
|
potential change in control if we acquire one or more target businesses for shares; |
|
our public securities potential liquidity and trading; |
|
regulatory or operational risks associated with acquiring a target business; |
|
use of proceeds not held in the trust account; |
|
financial performance following this offering; or |
|
listing or delisting of our securities from Nasdaq or the ability to have our securities listed on Nasdaq following our initial business combination. |
Without Over-Allotment Option |
Over-Allotment Option Exercised |
|||||||||
---|---|---|---|---|---|---|---|---|---|---|
Gross
proceeds |
||||||||||
From offering
|
$ | 100,000,000 | $ | 115,000,000 | ||||||
From private
placement |
5,750,000 | 6,050,000 | ||||||||
Total gross
proceeds |
105,750,000 | 121,050,000 | ||||||||
Offering
expenses(1) |
||||||||||
Underwriting
discount (2.325% of gross proceeds from offering) |
2,325,000 | (2) | 2,325,000 | (2) | ||||||
Financial
advisor fee |
175,000 | 175,000 | ||||||||
Legal fees
and expenses |
250,000 | 250,000 | ||||||||
Nasdaq
listing fee |
75,000 | 75,000 | ||||||||
Printing and
engraving expenses |
45,000 | 45,000 | ||||||||
Accounting
fees and expenses |
40,000 | 40,000 | ||||||||
FINRA filing
fee |
18,000 | 18,000 | ||||||||
SEC
registration fee |
15,000 | 15,000 | ||||||||
Miscellaneous
expenses |
57,000 | 57,000 | ||||||||
Total
offering expenses |
3,000,000 | 3,000,000 | ||||||||
Net
proceeds |
||||||||||
Held in trust
|
102,000,000 | 117,300,000 | ||||||||
Not held in
trust |
750,000 | 750,000 | ||||||||
Total net
proceeds |
$ | 102,750,000 | $ | 118,050,000 | ||||||
Use of net
proceeds not held in trust and amounts available from interest income earned on the trust account(3)(4) |
||||||||||
Legal,
accounting and other third party expenses attendant to the search for target businesses and to the due diligence investigation, structuring and
negotiation of a business combination |
$ | 200,000 | (23.5%) | |||||||
Due diligence
of prospective target businesses by officers, directors and initial stockholders |
50,000 | (5.8%) | ||||||||
Legal and
accounting fees relating to SEC reporting obligations |
100,000 | (11.8%) | ||||||||
Payment of
administrative fee to Crescendo Advisors II, LLC ($12,500 per month for up to 24 months) |
300,000 | (35.3%) | ||||||||
Corporate and
franchise taxes |
100,000 | (11.8%) | ||||||||
Working
capital to cover miscellaneous expenses, D&O insurance, general corporate purposes, Nasdaq continued listing fees, liquidation obligations and
reserves |
100,000 | (11.8%) | ||||||||
Total
|
$ | 850,000 | (100.0%) |
(1) |
A portion of the offering expenses, including the SEC registration fee, the FINRA filing fee, the non-refundable portion of the Nasdaq listing fee and a portion of the legal and audit fees, have been paid from the funds we received from Eric S. Rosenfeld described below. These funds will be repaid out of the proceeds of this offering available to us. |
(2) |
The underwriting discount of 2.325% is payable at the closing of the offering (excluding proceeds received from the exercise of the over-allotment option, on which we will not pay any underwriting discount). Additionally, a deferred underwriting fee of up to 3.0% is payable upon consummation of our initial business combination and will be held in the trust account until consummation of such business combination. No discounts or commissions will be paid with respect to the purchase of the private units. |
(3) |
The amount of proceeds not held in trust will remain constant at $750,000 even if the over-allotment is exercised. In addition, interest income earned on the amounts held in the trust account will be available to us to pay for our income and other tax obligations. We estimate the interest earned on the trust account will be approximately $100,000 over a 24-month period assuming an interest rate of approximately 0.05% per year. |
(4) |
These are estimates only. Our actual expenditures for some or all of these items may differ from the estimates set forth herein. For example, we may incur greater legal and accounting expenses than our current estimates in connection with negotiating and structuring our initial business combination based upon the level of complexity of that business combination. We do not anticipate any change in our intended use of proceeds, other than fluctuations among the current categories of allocated expenses, which fluctuations, to the extent they exceed current estimates for any specific category of expenses, would be deducted from our excess working capital. |
Public
offering price |
$ | 10.00 | ||||||||
Net tangible
book value before this offering |
$ | (0.03 | ) | |||||||
Increase
attributable to new investors and private sales |
1.47 | |||||||||
Pro forma net
tangible book value after this offering |
1.44 | |||||||||
Dilution to
new investors |
$ | 8.56 | ||||||||
Percentage of
dilution to new investors |
85.6 | % |
Shares Purchased |
Total Consideration |
Average Price per Share |
|||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Number |
Percentage |
Amount |
Percentage |
||||||||||||||||||||
Initial
stockholders |
3,218,750(1) | 24.3 | % | $ | 5,775,000 | 5.5 | % | $ | 1.79 | ||||||||||||||
New investors
|
10,000,000 | 75.7 | % | 100,000,000 | 94.5 | % | $ | 10.00 | |||||||||||||||
13,218,750 | 100.0 | % | $ | 105,775,000 | 100.0 | % |
(1) |
Assumes the over-allotment option has not been exercised and an aggregate of 382,500 shares of common stock held by our initial stockholders have been forfeited as a result thereof. Includes 575,000 private shares issued simultaneously with the consummation of this offering. |
Numerator: |
||||||
Net tangible
book value before the offering |
$ | (74,457 | ) | |||
Net proceeds
from this offering and private placement of private units |
102,750,000 | |||||
Offering
costs excluded from net tangible book value before this offering |
98,362 | |||||
Less:
Deferred underwriters commission |
(3,000,000 | ) | ||||
Less:
Proceeds held in trust subject to possible conversion |
(93,999,989 | ) | ||||
$ | 5,773,916 | |||||
Denominator: |
||||||
Shares of
common stock outstanding prior to this offering |
2,643,750 | (1) | ||||
Shares of
common stock included in the units offered |
10,000,000 | |||||
Shares of
common stock to be sold in private placement |
575,000 | |||||
Less: Shares
subject to possible conversion |
(9,215,685 | ) | ||||
4,003,065 |
(1) |
Assumes the over-allotment option has not been exercised and an aggregate of 382,500 shares of common stock held by our initial stockholders have been forfeited as a result thereof. |
September 30, 2014(1) |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Actual |
As Adjusted(2) |
||||||||||
Note payable
to related party(3) |
$ | 50,000 | $ | | |||||||
Deferred
underwriting commissions |
| 3,000,000 | |||||||||
Shares of
common stock, par value $0.0001 per share, -0- and 9,215,685 shares which are subject to possible conversion |
| 93,999,989 | (5) | ||||||||
Stockholders equity: |
|||||||||||
Shares of
preferred stock, par value $0.0001 per share, 1,000,000 shares authorized; none issued or outstanding |
| | |||||||||
Shares of
common stock, par value $0.0001 per share, 16,000,000 shares authorized(6); 3,026,250 shares issued and outstanding, actual; 4,003,065
shares issued and outstanding(4) (excluding 9,215,685 shares subject to possible conversion), as adjusted |
303 | 400 | |||||||||
Additional
paid-in capital |
24,697 | 5,774,611 | |||||||||
Accumulated
deficit |
(1,095 | ) | (1,095 | ) | |||||||
Total
stockholders equity: |
$ | 23,905 | $ | 5,773,916 | |||||||
Total
capitalization |
$ | 73,905 | $ | 102,773,905 |
(1) |
September 30, 2014 balances reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock effectuated in November 2014. |
(2) |
Includes the proceeds to be received from this offering as the offering is being made on a firm commitment basis and therefore the underwriters are obligated to purchase the units on the date of this prospectus. Also includes the $5,750,000 we will receive from the sale of the private units. |
(3) |
Note payable to related party is a promissory note issued in the aggregate amount of $50,000 to Eric S. Rosenfeld. The note is non-interest bearing and is payable on the earliest to occur of (i) May 31, 2015, (ii) the consummation of this offering or (iii) the date on which we determine not to proceed with this offering. |
(4) |
Assumes the over-allotment option has not been exercised and an aggregate of 382,500 shares of common stock held by our initial stockholders have been forfeited as a result thereof. |
(5) |
Derived by taking 9,215,685 shares of common stock which may be converted, representing the maximum number of shares that may be converted while maintaining at least $5,000,001 in net tangible assets after the offering, multiplied by a conversion price of approximately $10.20. |
(6) |
Our certificate of incorporation will be amended prior to the closing of this offering to authorize the issuance of up to 25,000,000 shares of common stock. |
|
may significantly reduce the equity interest of our stockholders; |
|
may subordinate the rights of holders of shares of common stock if we issue shares of preferred stock with rights senior to those afforded to our shares of common stock; |
|
will likely cause a change in control if a substantial number of our shares of common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and most likely will also result in the resignation or removal of our present officers and directors; and |
|
may adversely affect prevailing market prices for our securities. |
|
default and foreclosure on our assets if our operating revenues after a business combination are insufficient to pay our debt obligations; |
|
acceleration of our obligations to repay the indebtedness even if we have made all principal and interest payments when due if the debt security contains covenants that required the maintenance of certain financial ratios or reserves and we breach any such covenant without a waiver or renegotiation of that covenant; |
|
our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; and |
|
our inability to obtain additional financing, if necessary, if the debt security contains covenants restricting our ability to obtain additional financing while such security is outstanding. |
|
$200,000 of expenses for the search for target businesses and for the legal, accounting and other third-party expenses attendant to the due diligence investigations, structuring and negotiating of a business combination; |
|
$50,000 of expenses for the due diligence and investigation of a target business by our officers, directors and initial stockholders; |
|
$100,000 of expenses in legal and accounting fees relating to our SEC reporting obligations; |
|
$300,000 for the payment of the administrative fee to Crescendo Advisors II, LLC (of $12,500 per month for up to 24 months); |
|
$100,000 for corporate and franchise taxes; and |
|
$100,000 for general working capital that will be used for miscellaneous expenses, Nasdaq continued listing fees liquidation obligations and reserves, including director and officer liability insurance premiums. |
|
staffing for financial, accounting and external reporting areas, including segregation of duties; |
|
reconciliation of accounts; |
|
proper recording of expenses and liabilities in the period to which they relate; |
|
evidence of internal review and approval of accounting transactions; |
|
documentation of processes, assumptions and conclusions underlying significant estimates; and |
|
documentation of accounting policies and procedures. |
|
financial condition and results of operation; |
|
growth potential; |
|
brand recognition and potential; |
|
return on equity or invested capital; |
|
market capitalization or enterprise value; |
|
experience and skill of management and availability of additional personnel; |
|
capital requirements; |
|
competitive position; |
|
barriers to entry; |
|
stage of development of its products, processes or services; |
|
existing distribution and potential for expansion; |
|
degree of current or potential market acceptance of the products, processes or services; |
|
proprietary aspects of products and the extent of intellectual property or other protection for its products, processes, formulas or services; |
|
impact of regulation on the business; |
|
regulatory environment of the industry; |
|
costs associated with effecting the business combination; |
|
industry leadership, sustainability of market share and attractiveness of market industries in which a target business participates; and |
|
macro competitive dynamics in the industry within which the company competes. |
|
subject us to numerous economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to a business combination, and |
|
result in our dependency upon the performance of a single operating business or the development or market acceptance of a single or limited number of products, processes or services. |
|
prior to the consummation of our initial business combination, we shall seek stockholder approval of our initial business combination at a meeting called for such purpose at which public stockholders may seek to convert their shares of common stock, regardless of whether they vote for or against the proposed business combination, into a portion of the aggregate amount then on deposit in the trust account, subject to the limitations described herein; |
|
we will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation and a majority of the outstanding shares of common stock voted are voted in favor of the business combination; |
|
if our initial business combination is not consummated within 24 months of the consummation of this offering, then our existence will terminate and we will distribute all amounts in the trust account and any net assets remaining outside the trust account to all of our public holders of shares of common stock; |
|
we may not consummate any other business combination, merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar transaction prior to our initial business combination; and |
|
prior to our initial business combination, we may not issue (i) any shares of common stock or any securities convertible into common stock, or (ii) any securities that participate in any manner in the proceeds of the trust account, or that vote as a class with the common stock sold in this offering on our initial business combination. |
|
our obligation to seek stockholder approval of a business combination may delay the completion of a transaction; |
|
our obligation to convert public shares held by our public stockholders (including NPIC Limited, DKU 2013 LLC, The K2 Principal Fund L.P. and Covalent Capital Partners Master Fund, L.P. but not our other initial stockholders) may reduce the resources available to us for a business combination; |
|
Nasdaq may require us to file a new listing application and meet its initial listing requirements to maintain the listing of our securities following a business combination; |
|
our outstanding warrants, and the potential future dilution they represent; |
|
our obligation to pay a deferred underwriting fee of up to 3.0% of the proceeds of this offering; |
|
our obligation to either repay or issue private units upon conversion of up to $500,000 of working capital loans that may be made to us by our initial stockholders, officers, directors or their affiliates; |
|
our obligation to register the resale of the insider shares, as well as the private units (and underlying securities) and any securities issued to our initial stockholders, officers, directors or their affiliates upon conversion of working capital loans; and |
|
the impact on the target business assets as a result of unknown liabilities under the securities laws or otherwise depending on developments involving us prior to the consummation of a business combination. |
Terms of the Offering |
Terms Under a Rule 419 Offering |
|||||||||
---|---|---|---|---|---|---|---|---|---|---|
Escrow of
offering proceeds |
$102,000,000 of the net offering proceeds and proceeds from the sale of the private units will be deposited into an account in the United
States maintained by Continental Stock Transfer & Trust Company, acting as trustee. |
$87,750,000 of the offering proceeds would be required to be deposited into either an escrow account with an insured depositary institution or
in a separate bank account established by a broker-dealer in which the broker-dealer acts as trustee for persons having the beneficial interests in the
account. |
||||||||
Investment
of net proceeds |
The
$102,000,000 of the net offering proceeds and proceeds from the sale of the private units held in trust will only be invested in United States
government treasury bills, bonds or notes with a maturity of 180 days or less or in money market funds meeting the applicable conditions under Rule
2a-7 promulgated under the Investment Company Act of 1940 and that invest solely in United States government treasuries. |
Proceeds could be invested only in specified securities such as a money market fund meeting conditions of the Investment Company Act of 1940
or in securities that are direct obligations of, or obligations guaranteed as to principal or interest by, the United States. |
||||||||
Limitation
on fair value or net assets of target business |
The
initial target business that we acquire must have a fair market value equal to at least 80% of the balance in our trust account at the time of the
execution of a definitive agreement for our initial business combination. |
We
would be restricted from acquiring a target business unless the fair value of such business or net assets to be acquired represent at least 80% of the
maximum offering proceeds. |
||||||||
Trading of
securities issued |
The
units may commence trading on or promptly after the date of this prospectus. The shares of common stock and warrants comprising the units will begin to
trade separately ten business days following the earlier to occur of the expiration of the underwriters over-allotment option, its exercise in
full or the announcement by the underwriters of its intention not to exercise all or any remaining portion of the over-allotment option, provided we
have filed with the SEC a Current Report on Form 8-K, which includes an audited balance sheet reflecting our receipt of the proceeds of this
offering. |
No
trading of the units or the underlying securities would be permitted until the completion of a business combination. During this period, the securities
would be held in the escrow or trust account. |
||||||||
Exercise of
the warrants |
The
warrants cannot be exercised until the completion of a business combination and, accordingly, will be exercised only after the trust account has been
terminated and distributed. |
The
warrants could be exercised prior to the completion of a business combination, but securities received and cash paid in connection with the exercise
would be deposited in the escrow or trust account. |
Terms of the Offering |
Terms Under a Rule 419 Offering | |||||||||
---|---|---|---|---|---|---|---|---|---|---|
Election to
remain an investor |
We
will give our stockholders the opportunity to vote on the business combination. We will send each stockholder a proxy statement containing information
required by the SEC. Under Delaware law and our bylaws, we must provide at least 10 days advance notice of any meeting of stockholders. Accordingly,
this is the minimum amount of time we would need to provide holders to determine whether to exercise their rights to convert their shares into cash or
to remain an investor in our company. |
A
prospectus containing information required by the SEC would be sent to each investor. Each investor would be given the opportunity to notify the
company, in writing, within a period of no less than 20 business days and no more than 45 business days from the effective date of the post-effective
amendment, to decide whether he or she elects to remain a stockholder of the company or require the return of his or her investment. If the company has
not received the notification by the end of the 45th business day, funds and interest or dividends, if any, held in the trust or escrow
account would automatically be returned to the stockholder. Unless a sufficient number of investors elect to remain investors, all of the deposited
funds in the escrow account must be returned to all investors and none of the securities will be issued. |
||||||||
Business
combination deadline |
Pursuant to our amended and restated certificate of incorporation, if we do not complete an initial business combination within 24 months from
the consummation of this offering, it will trigger our automatic winding up, dissolution and liquidation. |
If an
acquisition has not been consummated within 18 months after the effective date of the initial registration statement, funds held in the trust or escrow
account would be returned to investors. |
||||||||
Interest
earned on the funds in the trust account |
There
can be released to us, from time to time, any interest earned on the funds in the trust account that we may need to pay our tax obligations. The
remaining interest earned on the funds in the trust account will not be released until the earlier of the completion of a business combination and our
entry into liquidation upon failure to effect a business combination within the allotted time. |
All
interest earned on the funds in the trust account will be held in trust for the benefit of public stockholders until the earlier of the completion of a
business combination and our liquidation upon failure to effect a business combination within the allotted time. |
||||||||
Release of
funds |
Except for interest earned on the funds held in the trust account that may be released to us to pay our income or other tax obligations, the
proceeds held in the trust account will not be released until the earlier of the completion of a business combination (in which case, the funds
released to us would be net of the funds that would be paid to converting stockholders by Continental Stock Transfer & Trust Company, as trustee of
the trust account) and the liquidation of our trust account upon failure to effect a business combination within the allotted time. |
The
proceeds held in the escrow account would not be released until the earlier of the completion of a business combination or the failure to effect a
business combination within the allotted time. |
Name |
Age |
Position |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Eric S.
Rosenfeld |
57 | Chairman of the Board and Chief Executive Officer |
||||||||
David D. Sgro
|
38 | Chief Operating Officer and Director |
||||||||
Thomas
Kobylarz |
37 | Chief Financial Officer |
||||||||
John P.
Schauerman |
57 | Director |
||||||||
Adam J. Semler
|
50 | Director |
||||||||
Leonard B.
Schlemm |
61 | Director |
|
reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommending to the board whether the audited financial statements should be included in our Form 10-K; |
|
discussing with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of our financial statements; |
|
discussing with management major risk assessment and risk management policies; |
|
verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law; |
|
reviewing and approving all related-party transactions; |
|
inquiring and discussing with management our compliance with applicable laws and regulations; |
|
pre-approving all audit services and permitted non-audit services to be performed by our independent auditor, including the fees and terms of the services to be performed; |
|
appointing or replacing the independent auditor; |
|
determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work; |
|
establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies; and |
|
approving reimbursement of expenses incurred by our management team in identifying potential target businesses. |
|
should have demonstrated notable or significant achievements in business, education or public service; |
|
should possess the requisite intelligence, education and experience to make a significant contribution to the board of directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and |
|
should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the stockholders. |
|
reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officers compensation, evaluating our Chief Executive Officers performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officers based on such evaluation; |
|
reviewing and approving the compensation of all of our other executive officers; |
|
reviewing our executive compensation policies and plans; |
|
implementing and administering our incentive compensation equity-based remuneration plans; |
|
assisting management in complying with our proxy statement and annual report disclosure requirements; |
|
approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive officers and employees; |
|
if required, producing a report on executive compensation to be included in our annual proxy statement; and |
|
reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. |
|
None of our officers and directors is required to commit their full time to our affairs and, accordingly, they may have conflicts of interest in allocating their time among various business activities. |
|
In the course of their other business activities, our officers and directors may become aware of investment and business opportunities which may be appropriate for presentation to our company as well as the other entities with which they are affiliated. Our management has pre-existing fiduciary duties and contractual obligations and may have conflicts of interest in determining to which entity a particular business opportunity should be presented. |
|
Our officers and directors are now, and may in the future become, affiliated with entities, including other blank check companies, engaged in business activities identical to those intended to be conducted by our company. |
|
The insider shares owned by our officers and directors will be released from escrow only if a business combination is successfully completed and subject to certain other limitations. Additionally, our officers and directors will not receive distributions from the trust account with respect to any of their insider shares if we do not complete a business combination. Furthermore, the initial stockholders have agreed that the private units (and underlying securities) will not be sold or transferred by them until after we have completed our initial business combination. In addition, our officers and directors may loan funds to us after this offering and may be owed reimbursement for expenses incurred in connection with certain activities on our behalf which would only be repaid if we complete an initial business combination. For the foregoing reasons, the personal and financial interests of our directors and executive officers may influence their motivation in identifying and selecting a target business, completing a business combination in a timely manner and securing the release of their shares. |
|
the corporation could financially undertake the opportunity; |
|
the opportunity is within the corporations line of business; and |
|
it would not be fair to the corporation and its stockholders for the opportunity not to be brought to the attention of the corporation. |
Name of Affiliated Company |
Name of Individual(s) |
Priority/Preference relative to Harmony Merger Corp. |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
CPI
Aerostructures, Inc. |
Eric S. Rosenfeld |
Mr.
Rosenfeld will be required to present all business opportunities which are suitable for CPI Aerostructures to CPI Aerostructures prior to presenting
them to us. CPI Aerostructures is engaged in the contract production of structural aircraft parts principally for the United States Air Force and other
branches of the U.S. armed forces. |
||||||||
Absolute
Software |
Eric S. Rosenfeld |
Mr.
Rosenfeld will be required to present all business opportunities which are suitable for Absolute Software to Absolute Software provides persistent
endpoint security and management for computers, laptops, tablets and smartphone devices. |
||||||||
COM DEV
International |
David D. Sgro |
Mr.
Sgro will be required to present all business opportunities which are suitable for COM DEV International to COM DEV International prior to presenting
them to us. COM DEV International is a global designer and manufacturer of space hardware. |
||||||||
Cott
Corporation |
Eric S. Rosenfeld |
Mr.
Rosenfeld will be required to present all business opportunities which are suitable for the Cott Corporation to the Cott Corporation prior to
presenting them to us. Cott Corporation is a private label beverage company. |
||||||||
SAExploration
Holdings Inc. |
Eric S. Rosenfeld David D. Sgro |
Each
of Messrs. Rosenfeld and Sgro will be required to present all business opportunities which are suitable for SAExploration Holdings Inc. to
SAExploration Holdings Inc. prior to presenting them to us. SAE is a holding company of various subsidiaries which collectively form a geophysical
services company offering seismic data acquisition services to the oil and gas industry in North America, South America, and Southeast
Asia. |
||||||||
Pangaea
Logistics Solutions Ltd. |
Eric S. Rosenfeld David D. Sgro |
Each
of Messrs. Rosenfeld and Sgro will be required to present all business opportunities which are suitable for Pangaea to Pangaea prior to presenting them
to us. Pangaea is a Newport, Rhode Island-headquartered growth oriented global logistics company focused on providing seaborne drybulk transportation
services. |
Name of Affiliated Company |
Name of Individual(s) |
Priority/Preference relative to Harmony Merger Corp. | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
The Mansfield
Clubs |
Leonard B. Schlemm |
Mr.
Schlemm will be required to present all business opportunities which are suitable for The Mansfield Clubs to The Mansfield Clubs prior to presenting
them to us. The Mansfield Clubs are three high-end fitness centers in the Montreal area. |
||||||||
Myca Health
Inc. |
Leonard B. Schlemm |
Mr.
Schlemm will be required to present all business opportunities which are suitable for Myca Health Inc. to Myca Health Inc. prior to presenting them to
us. Myca Health Inc. is a medical software company focused on primary care practices across the United States. |
||||||||
The Atwater
Club |
Leonard B. Schlemm |
Mr.
Schlemm will be required to present all business opportunities which are suitable for The Atwater Club to The Atwater Club prior to presenting them to
us. The Atwater Club is a private racquet club in Montreal. |
|
each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock; |
|
each of our officers and directors; and |
|
all of our officers and directors as a group. |
Prior to Offering |
After Offering(2) |
||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name and Address of Beneficial Owner(1) |
Amount and Nature of Beneficial Ownership |
Approximate Percentage of Outstanding Shares of common stock |
Amount and Nature of Beneficial Ownership |
Approximate Percentage of Outstanding Shares of common stock |
|||||||||||||||
Eric S.
Rosenfeld |
1,430,566 | (3) * | 47.3 | % | 1,251,618 | (3)(4) | 9.5 | % | |||||||||||
David D. Sgro
|
310,956 | * | 10.3 | % | 259,475 | (5) | 1.9 | % | |||||||||||
Thomas
Kobylarz |
60,335 | 2.0 | % | 50,346 | (6) | * | |||||||||||||
John P.
Schauerman |
15,000 | * | * | 22,500 | (7) | * | |||||||||||||
Adam J.
Semler |
15,000 | * | * | 22,500 | (7) | * | |||||||||||||
Leonard B.
Schlemm |
119,800 | 4.0 | % | 202,500 | (8) | 1.5 | % | ||||||||||||
Polar
Securities Inc.(9) |
215,000 | 7.1 | % | 285,000 | (10) | 2.2 | % | ||||||||||||
DKU 2013
LLC(11) |
215,000 | 7.1 | % | 285,000 | (10) | 2.2 | % | ||||||||||||
The K2
Principal Fund L.P.(12) |
215,000 | 7.1 | % | 285,000 | (10) | 2.2 | % | ||||||||||||
Covalent
Capital Partners Master Fund, L.P.(13) |
180,000 | 5.9 | % | 270,000 | (14) | 2.0 | % | ||||||||||||
All directors
and executive officers as a group (six individuals) |
1,951,657 | 64.5 | % | 1,808,939 | (15) | 13.7 | % |
* |
Less than 1%. |
(1) |
Unless otherwise indicated, the business address of each of the individuals is c/o Harmony Merger Corp., 777 Third Avenue, 37th Floor, New York, New York 10017 |
(2) |
Assumes no exercise of the over-allotment option and, therefore, the forfeiture of an aggregate of 382,500 shares of common stock held by our initial stockholders. |
(3) |
Includes 60,000 shares held by the Rosenfeld Childrens Successor Trust, a trust established for Mr. Rosenfelds children. |
(4) |
Includes 25,871 private units to be held by Mr. Rosenfeld and 30,000 private units to be held by the Rosenfeld Childrens Successor Trust, which private units will be purchased simultaneously with the consummation of this offering, and assumes the forfeiture of an aggregate of 219,619 shares and the transfer of an aggregate of 15,200 shares to Mr. Schlemm, each as a result of the over-allotment option not being exercised. |
(5) |
Includes 2,538 private units to be held by Mr. Sgro, which private units will be purchased simultaneously with the consummation of this offering, and assumes the forfeiture of an aggregate of 54,019 shares as a result of the over-allotment option not being exercised. |
(6) |
Includes 492 private units to be held by Mr. Kobylarz, which private units will be purchased simultaneously with the consummation of this offering, and assumes the forfeiture of an aggregate of 10,481 shares as a result of the over-allotment option not being exercised. |
(7) |
Includes 7,500 private units to be held by this individual, which private units will be purchased simultaneously with the consummation of this offering. |
(8) |
Includes 67,500 private units to be held by Mr. Schlemm, which private units will be purchased simultaneously with the consummation of this offering, and assumes the receipt of an aggregate of 15,200 shares to be transferred from Mr. Rosenfeld as a result of the over-allotment option not being exercised. |
(9) |
The business address of Polar Securities Inc. is 401 Bay Street, Suite 1900 P.O. Box 19 ¦ Toronto, Ontario M5H 2Y4. Represents shares held by NPIC Limited, a fund for which Polar Securities, Inc. serves as investment manager. J. Paul Sabourin, Chairman and Chief Investment Officer of Polar Securities, has voting and dispositive power over the shares held by NPIC Limited. |
(10) |
Includes 95,000 private units to be held by this entity, which private units will be purchased simultaneously with the consummation of this offering, and assumes the forfeiture of an aggregate of 25,000 shares as a result of the over-allotment option not being exercised. |
(11) |
The business address of DKU 2013, LLC is 405 Park Avenue, 6th Floor, New York, NY 10022. Jeff Keswin has ultimate voting and dispositive power over the shares held by DKU 2013, LLC. |
(12) |
The business address of The K2 Principal Fund L.P. is 2 Bloor Street West, Suite 801, Toronto, Ontario, Canada M4W 3E2. Shawn Kimel has ultimate voting and dispositive power over the shares held by The K2 Principal Fund L.P. as he is President of K2 Genpar 2009 Inc., the General Partner of K2 Genpar L.P., the General Partner of The K2 Principal Fund L.P. |
(13) |
The business address of Covalent Capital Partners Master Fund, L.P. is 190 Elgin Avenue, Grand Cayman, Cayman Islands, KY1-9005. Robert Hockett has voting and dispositive power over the shares held by Covalent Capital Partners Master Fund, L.P. Does not include 720,000 shares underlying units that Covalent Capital Partners Master Fund, L.P. has indicated an intention to purchase in this offering. |
(14) |
Includes 90,000 private units to be held by Covalent Capital Partners Master Fund, L.P., which private units will be purchased simultaneously with the consummation of this offering. |
(15) |
Includes an aggregate of 141,401 private units to be held by our executive officers and directors, which private units will be purchased simultaneously with the consummation of this offering, and assumes the forfeiture of an aggregate of 284,119 shares as a result of the over-allotment option not being exercised. |
Name |
Number of Shares |
Relationship to Us |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
NPIC
Limited |
231,000 | Initial Stockholder |
||||||||
DKU
2013 LLC |
231,000 | Initial Stockholder |
||||||||
The K2
Principal Fund L.P. |
231,000 | Initial Stockholder |
|
at any time while the warrants are exercisable, |
|
upon not less than 30 days prior written notice of redemption to each warrant holder, |
|
if, and only if, the reported last sale price of the shares of common stock equals or exceeds $21.00 per share, for any 20 trading days within a 30-day trading period ending on the third business day prior to the notice of redemption to warrant holders, and |
|
if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants commencing five business days prior to the 30-day trading period and continuing each day thereafter until the date of redemption. |
|
1% of the number of shares of common stock then outstanding, which will equal 132,187 shares immediately after this offering (or 151,312 if the over-allotment option is exercised in full); and |
|
the average weekly trading volume of the shares of common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale. |
|
the issuer of the securities that was formerly a shell company has ceased to be a shell company; |
|
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; |
|
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and |
|
at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company. |
Underwriters |
Number of Units |
|||||
---|---|---|---|---|---|---|
Cantor
Fitzgerald & Co. |
||||||
Total
|
10,000,000 |
|
receipt and acceptance of the units by the underwriters; and |
|
the underwriters right to reject orders in whole or in part. |
Per Unit |
Without Over-allotment |
With Over-allotment |
||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Public
offering price |
$ | 10.00 | $ | 100,000,000 | $ | 115,000,000 | ||||||||
Discount(1) |
$ | 0.5325 | $ | 5,325,000 | $ | 5,775,000 | ||||||||
Proceeds
before expenses(2) |
$ | 9.4675 | $ | 94,675,000 | $ | 109,225,000 |
(1) |
The underwriting discount of 2.325% is payable at the closing of the offering (excluding proceeds received from the exercise of the over-allotment option, on which we will not pay any underwriting discount, resulting in an effective underwriting discount of approximately 2.021% if the over-allotment option is exercised in full). Additionally, pursuant to the underwriting agreement, a deferred underwriting fee of up to 3.0% is payable upon consummation of our initial business combination and will be held in the trust account until consummation of such business combination. |
(2) |
The offering expenses are estimated at $500,000. |
|
the history and prospects of companies whose principal business is the acquisition of other companies; |
|
prior offerings of those companies; |
|
our prospects for acquiring an operating business at attractive values; |
|
our capital structure; |
|
the per share amount of net proceeds being placed into the trust account; |
|
an assessment of our management and their experience in identifying operating companies; |
|
general conditions of the securities markets at the time of the offering; and |
|
other factors as were deemed relevant. |
|
Stabilizing Transactions. The underwriters may make bids or purchases for the purpose of preventing or retarding a decline in the price of our units, as long as stabilizing bids do not exceed the offering price of $10.00 and the underwriters comply with all other applicable rules. |
|
Over-Allotments and Syndicate Coverage Transactions. The underwriters may create a short position in our units by selling more of our units than are set forth on the cover page of this prospectus up to the amount of the over-allotment option. This is known as a covered short position. The underwriters may also create a short position in our units by selling more of our units than are set forth on the cover page of this prospectus and the units allowed by the over-allotment option. This is known as a naked short position. If the underwriters create a short position during the offering, the representative may engage in syndicate covering transactions by purchasing our units in the open market. The representative may also elect to reduce any short position by exercising all or part of the over-allotment option. Determining what method to use in reducing the short position depends on how the units trade in the aftermarket following the offering. If the unit price drops following the offering, the short position is usually covered with shares purchased by the underwriters in the aftermarket. However, the underwriters may cover a short position by exercising the over-allotment option even if the unit price drops following the offering. If the unit price rises after the offering, then the over-allotment option is used to cover the short position. If the short position is more than the over-allotment option, the naked short must be covered by purchases in the aftermarket, which could be at prices above the offering price. |
|
Penalty Bids. The representative may reclaim a selling concession from a syndicate member when the units originally sold by the syndicate member are purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions. |
F-2 |
||||||
F-3 |
||||||
F-4 |
||||||
F-5 |
||||||
F-6 F-11 |
F-13 |
||||||
F-14 |
||||||
F-15 |
||||||
F-16 |
||||||
F-17 |
||||||
F-18 F-23 |
ASSETS |
||||||
Current
assets Cash and cash equivalents |
$ | 6,343 | ||||
Deferred
offering costs associated with initial public offering |
98,362 | |||||
Total
assets |
$ | 104,705 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||
Current
liabilities: |
||||||
Deferred
offering costs payable |
$ | 30,800 | ||||
Note payable
to stockholder |
50,000 | |||||
Total
liabilities |
$ | 80,800 | ||||
Commitments |
||||||
Stockholders equity |
||||||
Preferred
stock, $.0001 par value |
||||||
Authorized
1,000,000 shares; none issued |
$ | | ||||
Common stock,
$.0001 par value |
||||||
Authorized
16,000,000 shares, 3,026,250 issued and outstanding(1)(2) |
303 | |||||
Additional
paid-in capital |
24,697 | |||||
Accumulated
deficit |
(1,095 | ) | ||||
Total
stockholders equity |
$ | 23,905 | ||||
Total
liabilities and stockholders equity |
$ | 104,705 |
(1) |
Share amounts have been retroactively restated to reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock on November 7, 2014. |
(2) |
Includes an aggregate of 382,500 shares subject to forfeiture by the initial stockholders to the extent that the underwriters over-allotment option is not exercised in full. (Note 7) |
General and
administrative costs |
$ | 1,125 | ||||
Operating
loss |
(1,125 | ) | ||||
Other
income: |
||||||
Interest
income |
30 | |||||
Net loss
|
$ | (1,095 | ) | |||
Weighted
average shares outstanding(1)(2) |
2,643,750 | |||||
Basic and
diluted net loss per share |
$ | (0.00 | ) |
(1) |
Share amounts have been retroactively restated to reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock on November 7, 2014. |
(2) |
Excludes an aggregate of 382,500 shares subject to forfeiture by the initial stockholders to the extent that the underwriters over-allotment option is not exercised in full. (Note 7) |
Common Stock |
||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Shares(1)(2) |
Amount |
Additional Paid-In Capital |
Accumulated deficit |
Shareholders Equity |
||||||||||||||||||
Common shares
issued to initial stockholders |
3,026,250 | $ | 303 | $ | 24,697 | $ | | $ | 25,000 | |||||||||||||
Net Loss
|
| | | (1,095 | ) | (1,095 | ) | |||||||||||||||
Balance at
September 30, 2014 |
3,026,250 | $ | 303 | $ | 24,697 | $ | (1,095 | ) | $ | 23,905 |
(1) |
Share amounts have been retroactively restated to reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock on November 7, 2014. |
(2) |
Includes an aggregate of 382,500 shares subject to forfeiture by the initial stockholders to the extent that the underwriters over-allotment option is not exercised in full. (Note 7) |
Cash flow
from operating activities |
||||||
Net
loss |
$ | (1,095 | ) | |||
Net cash
used in operating activities |
(1,095 | ) | ||||
Cash flows
from financing activities |
||||||
Payment of
deferred offering costs associated with initial public offering |
(67,562 | ) | ||||
Proceeds from
sale of shares of common stock to initial stockholders |
25,000 | |||||
Proceeds from
note payable, stockholder |
50,000 | |||||
Net cash
provided by financing activities |
7,438 | |||||
Net
increase in cash and cash equivalents |
6,343 | |||||
Cash and cash
equivalents at beginning of period |
| |||||
Cash and
cash equivalents at end of period |
$ | 6,343 | ||||
Non-cash
financing activity |
||||||
Accrual of
deferred offering costs |
$ | 30,800 |
ASSETS |
||||||
Current
assets Cash and cash equivalents |
$ | 74,985 | ||||
Deferred
offering costs associated with initial public offering |
22,500 | |||||
Total
assets |
$ | 97,485 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||
Current
liabilities: |
||||||
Accounts
payable |
$ | 478 | ||||
Deferred
offering costs payable |
22,500 | |||||
Note payable
to stockholder |
50,000 | |||||
Total
current liabilities |
72,978 | |||||
Commitments |
||||||
Stockholders equity |
||||||
Preferred
stock, $.0001 par value; Authorized 1,000,000 shares; none issued |
| |||||
Common stock,
$.0001 par value; Authorized 16,000,000 shares, 3,026,250 shares issued and outstanding(1)(2) |
303 | |||||
Additional
paid-in capital |
24,697 | |||||
Accumulated
deficit |
(493 | ) | ||||
Total
stockholders equity |
24,507 | |||||
Total
liabilities and stockholders equity |
$ | 97,485 |
(1) |
Share amounts have been retroactively restated to reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock on November 7, 2014. |
(2) |
Includes an aggregate of 382,500 shares subject to forfeiture by the initial stockholders to the extent that the underwriters over-allotment option is not exercised in full. (Note 7) |
Formation and
operational costs |
$ | 493 | ||||
Net
loss |
$ | (493 | ) | |||
Weighted
average shares outstanding(1)(2) |
2,643,750 | |||||
Basic and
diluted net loss per share |
$ | (0.00 | ) |
(1) |
Share amounts have been retroactively restated to reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock on November 7, 2014. |
(2) |
Excludes an aggregate of 382,500 shares subject to forfeiture by the initial stockholders to the extent that the underwriters over-allotment option is not exercised in full. (Note 7) |
Common Stock |
||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Shares(1)(2) |
Amount |
Additional Paid-In Capital |
Accumulated deficit |
Shareholders Equity |
||||||||||||||||||
Common shares
issued to initial stockholders |
3,026,250 | $ | 303 | $ | 24,697 | $ | | $ | 25,000 | |||||||||||||
Net Loss
|
| | | (493 | ) | (493 | ) | |||||||||||||||
Balance at
May 31, 2014 |
3,026,250 | $ | 303 | $ | 24,697 | $ | (493 | ) | $ | 24,507 |
(1) |
Share amounts have been retroactively restated to reflect the effect of a stock dividend of approximately 0.05 shares of common stock for each outstanding share of common stock on November 7, 2014. |
(2) |
Includes an aggregate of 382,500 shares subject to forfeiture by the initial stockholders to the extent that the underwriters over-allotment option is not exercised in full. (Note 7) |
Cash flow
from operating activities |
||||||
Net loss
|
$ | (493 | ) | |||
Adjustments
to reconcile net loss to net cash used in operating activities: |
||||||
Change in
operating assets and liabilities: |
||||||
Increase in
accounts payable |
478 | |||||
Net cash
used in operating activities |
(15 | ) | ||||
Cash flows
from financing activities |
||||||
Proceeds from
sale of shares of common stock to initial stockholders |
25,000 | |||||
Proceeds from
note payable, stockholder |
50,000 | |||||
Net cash
provided by financing activities |
75,000 | |||||
Net
increase in cash and cash equivalents |
74,985 | |||||
Cash and cash
equivalents at beginning of period |
| |||||
Cash and
cash equivalents at end of period |
$ | 74,985 | ||||
Non-cash
financing activities |
||||||
Accrual of
deferred offering costs |
$ | 22,500 |
Initial
Trustees fee |
$ | 1,000 | (1) | |||
SEC
Registration Fee |
15,000 | |||||
FINRA filing
fee |
18,000 | |||||
Accounting
fees and expenses |
40,000 | |||||
Nasdaq listing
fees |
75,000 | |||||
Printing and
engraving expenses |
45,000 | |||||
Directors
& Officers liability insurance premiums |
75,000 | (2) | ||||
Legal fees and
expenses |
250,000 | |||||
Miscellaneous
|
56,000 | (3) | ||||
Total
|
$ | 575,000 |
(1) |
In addition to the initial acceptance fee that is charged by Continental Stock Transfer & Trust Company, as trustee, the registrant will be required to pay to Continental Stock Transfer & Trust Company $16,100 for acting as trustee, as transfer agent of the registrants shares of common stock, as warrant agent for the registrants warrants and as escrow agent. |
(2) |
This amount represents the approximate amount of director and officer liability insurance premiums the registrant anticipates paying following the consummation of its initial public offering and until it consummates a business combination. |
(3) |
This amount represents additional expenses that may be incurred by the Company in connection with the offering over and above those specifically listed above, including distribution and mailing costs. |
Exhibit No. |
Description |
|||||
---|---|---|---|---|---|---|
1.1 | Form
of Underwriting Agreement. |
|||||
3.1 | Certificate of incorporation.** |
|||||
3.2 | Amended and Restated Certificate of incorporation.** |
|||||
3.3 | Bylaws.** |
|||||
4.1 | Specimen Unit Certificate.** |
|||||
4.2 | Specimen Common Share Certificate.** |
|||||
4.3 | Specimen Warrant Certificate. ** |
|||||
4.4 | Form
of Warrant Agreement between Continental Stock Transfer & Trust Company and the Registrant. ** |
|||||
5.1 | Opinion of Graubard Miller. |
|||||
10.1 | Form
of Letter Agreement among the Registrant, Cantor Fitzgerald & Co. and the Companys officers, directors and
stockholders. ** |
|||||
10.2 | Form
of Investment Management Trust Agreement between Continental Stock Transfer & Trust Company and the Registrant.** |
|||||
10.3 | Form
of Escrow Agreement between the Registrant, Continental Stock Transfer & Trust Company and the Initial Stockholders.** |
|||||
10.4 | Form
of Promissory Note issued to Eric S. Rosenfeld.** |
|||||
10.5 | Form
of Registration Rights Agreement among the Registrant and the Initial Stockholders.** |
|||||
10.6.1 | Subscription Agreement among the Registrant, Graubard Miller and Eric S. Rosenfeld. |
|||||
10.6.2 | Subscription Agreement among the Registrant, Graubard Miller and David D. Sgro. |
|||||
10.6.3 | Subscription Agreement among the Registrant, Graubard Miller and Greg Monahan. |
|||||
10.6.4 | Subscription Agreement among the Registrant, Graubard Miller and Tom Kobylarz. |
|||||
10.6.5 | [Intentionally omitted]. |
|||||
10.6.6 | Subscription Agreement among the Registrant, Graubard Miller and Joel Greenblatt.** |
Exhibit No. |
Description | |||||
---|---|---|---|---|---|---|
10.6.7 | Subscription Agreement among the Registrant, Graubard Miller and Adam Semler.** |
|||||
10.6.8 | Subscription Agreement among the Registrant, Graubard Miller and John Schauerman.** |
|||||
10.6.9 | Subscription Agreement among the Registrant, Graubard Miller and Leonard Schlemm. |
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10.6.10 | Subscription Agreement among the Registrant, Graubard Miller and Jeff Hastings.** |
|||||
10.6.11 | Subscription Agreement among the Registrant, Graubard Miller and DKU 2013 LLC.** |
|||||
10.6.12 | Subscription Agreement among the Registrant, Graubard Miller and The K2 Principal Fund L.P.** |
|||||
10.6.13 | Subscription Agreement among the Registrant, Graubard Miller and NPIC Limited.** |
|||||
10.6.14 | Subscription Agreement among the Registrant, Graubard Miller and Covalent Capital Partners Master Fund, L.P.** |
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10.7 | Form
of letter agreement between Crescendo Advisors II, LLC and the Registrant.** |
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10.8 | Financial Advisor Agreement. ** |
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10.9 | Form of confirmation letter from each Initial Stockholder. |
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14 | Form
of Code of Ethics.** |
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23.1 | Consent of Marcum LLP. |
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23.2 | Consent of Graubard Miller (included in Exhibit 5.1). |
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24 | Power
of Attorney (included on signature page of this Registration Statement). |
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99.1 | Form
of Audit Committee Charter.** |
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99.2 | Form
of Nominating Committee Charter.** |
|||||
99.3 | Form
of Compensation Committee Charter.** |
** |
Previously filed. |
(a) |
The undersigned registrant hereby undertakes: |
HARMONY MERGER CORP. |
||||||||||
By: |
/s/ Eric S. Rosenfeld |
|||||||||
Name: |
Eric
S. Rosenfeld |
|||||||||
Title: |
Chief
Executive Officer |
Name |
Position |
Date |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
/s/ Eric
S. Rosenfeld Eric S. Rosenfeld |
Chairman of the Board and Chief Executive Officer (Principal executive officer) |
January 21, 2015 |
||||||||
/s/ Thomas
Kobylarz Thomas Kobylarz |
Chief
Financial Officer (Principal financial and accounting officer) |
January 21, 2015 |
||||||||
/s/ David
D. Sgro David D. Sgro |
Chief
Operating Officer and Director |
January 21, 2015 |
||||||||
/s/ John
P. Schauerman John P. Schauerman |
Director |
January 21, 2015 |
||||||||
/s/ Adam
J. Semler Adam J. Semler |
Director |
January 21, 2015 |
||||||||
/s/
Leonard B. Schlemm Leonard B. Schlemm |
Director |
January 21, 2015 |
Exhibit 1.1
UNDERWRITING AGREEMENT
between
HARMONY MERGER CORP.
and
CANTOR FITZGERALD & CO.
Dated: __________, 2015
HARMONY MERGER CORP.
UNDERWRITING AGREEMENT
New York, New York
__________, 2015
CANTOR FITZGERALD & CO.
499 Park Avenue
New York, NY 10022
As Representative of the
Several Underwriters named in Schedule I hereto
Re: Public Offering of Securities
Ladies and Gentlemen:
The undersigned, Harmony Merger Corp., a Delaware corporation (the “Company”), hereby confirms its agreement with Cantor Fitzgerald & Co. (“CF&CO”) and with the other underwriters named on Schedule I hereto, for which CF&CO is acting as representative (CF&CO, in its capacity as representative, is referred to herein as the “Representative”; the Representative and the other underwriters are collectively referred to as the “Underwriters” or, individually, an “Underwriter”) as follows:
1. Purchase and Sale of Securities.
1.1 Firm Securities.
1.1.1 Purchase of Firm Units. On the basis of the representations and warranties contained herein, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell to the several Underwriters, severally and not jointly, an aggregate of 10,000,000 units (“Firm Units”) of the Company, at a purchase price (net of discounts and commissions and the Deferred Underwriting Commission described in Section 1.3 below) of $9.4675 per Firm Unit. The Underwriters, severally and not jointly, agree to purchase from the Company the number of Firm Units set forth opposite their respective names on Schedule I attached hereto and made a part hereof at a purchase price (net of discounts and commissions and the Deferred Underwriting Commission) of $9.4675 per Firm Unit. The Firm Units are to be offered initially to the public (“Offering”) at the offering price of $10.00 per Firm Unit. Each Firm Unit consists of one share of common stock, $0.0001 par value, of the Company (“Common Stock”), and one warrant to purchase three-fourths (3/4) of a share of Common Stock (the “Warrant”). The Common Stock and the Warrants included in the Firm Units will trade separately on the 10th Business Day (as defined below) following the earlier to occur of the expiration of the Underwriters’ Over-allotment Option (as defined below), the exercise in full or the announcement by the Underwriters of its intention not to exercise all or any remaining portion of the Over-allotment Option, but in no event will the Common Stock and the Warrants included in the Firm Units trade separately prior to the Business Day after (i) the Company has filed with the Securities and Exchange Commission (the “Commission”) a Current Report on Form 8-K that includes an audited balance sheet reflecting the Company’s receipt of the proceeds of the Offering and the Unit Private Placement (as defined in Section 1.4) and updated financial information with respect to any proceeds the Company receives from the exercise of the Over-allotment Option if such option is exercised prior to the filing of the Form 8-K, and (ii) the Company has filed with the Commission a Current Report on Form 8-K and issued a press release announcing when such separate trading will begin. Each Warrant entitles its holder to purchase three-fourths (3/4) of one share of Common Stock for a price of $11.50 per full share, during the period commencing on the later of the 30th day following consummation by the Company of its Business Combination (as defined below) or twelve (12) months from the date of the Prospectus (as defined in Section 2.1.1 hereof); provided, in each case, that an effective registration statement under the Act (as defined in Section 1.4.1 hereof) covering the Common Stock underlying the Warrants and a current prospectus in respect thereof are available. The Warrants will expire at 5:00 p.m., New York City time, on the five-year anniversary of the consummation by the Company of its merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”), or earlier upon redemption, as described in the Registration Statement (as defined below).
1.1.2 Payment and Delivery. Delivery and payment for the Firm Units shall be made at 10:00 a.m., New York City time, on the third (3rd) Business Day (as defined below) following the commencement of trading of the Units, or at such earlier time as shall be agreed upon by the Representative and the Company, at the offices of Ellenoff Grossman & Schole LLP (“EGS”) or at such other place as shall be agreed upon by the Representative and the Company. The hour and date of delivery and payment for the Firm Units is called the “Closing Date.” Payment for the Firm Units shall be made on the Closing Date at the Representative’s election by wire transfer in Federal (same day) funds, payable as follows: $96,425,000 of the proceeds received by the Company for the Firm Units shall be deposited in the trust account established by the Company for the benefit of the Public Stockholders (as defined below) and the Underwriters, as described in the Registration Statement (“Trust Account”) pursuant to the terms of an Investment Management Trust Agreement (the “Trust Agreement”) between the Company and Continental Stock Transfer & Trust Company (“CST”). The amount deposited in the Trust Account shall include an aggregate of $3,000,000 ($0.30 per Firm Unit), payable to the Representative as a Deferred Underwriting Commission, in accordance with Section 1.3 hereof. The remaining proceeds (less commissions and actual expense payments or other fees payable pursuant to this Agreement), if any, shall be paid (subject to Section 3.13 hereof) to the order of the Company upon delivery to the Representative of certificates (in form and substance satisfactory to the Representative) representing the Firm Units (or through the facilities of the Depository Trust Company (“DTC”)) for the account of the Underwriters. The Firm Units shall be registered in such name or names and in such authorized denominations as the Representative may request in writing at least two (2) full Business Days prior to the Closing Date. The Company will permit the Representative to examine and package the Firm Units for delivery, at least one (1) full Business Day prior to the Closing Date. The Company shall not be obligated to sell or deliver any of the Firm Units except upon tender of payment by the Representative for all the Firm Units. As used herein, the term “Public Stockholders” means the holders of Common Stock sold as part of the Units in the Offering or acquired in the aftermarket, including any Company stockholder prior to the Offering to the extent they acquire such Common Stock in the aftermarket (and solely with respect to such Common Stock). “Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies are authorized or obligated by law to close in New York City.
2 |
1.2 Over-Allotment Option.
1.2.1 Option Units. The Underwriters are hereby granted, severally and not jointly, an option (the “Over-allotment Option”) to purchase up to an additional 1,500,000 units (the “Option Units”) solely for the purposes of covering any over-allotments, if any, in connection with the distribution and sale of the Firm Units. Such Option Units shall, at the Representative’s election, be purchased for each account of the several Underwriters in the same proportion as the number of Firm Units, set forth opposite such Underwriter’s name on Schedule I hereto, bears to the total number of Firm Units (subject to adjustment by the Representative to eliminate fractions). Such Option Units shall be identical in all respects to the Firm Units. The Firm Units and the Option Units are hereinafter collectively referred to as the “Units,” and the Units, the Common Stock and the Warrants included in the Units and the Common Stock issuable upon exercise of the Warrants (the “Warrant Shares”) are hereinafter referred to collectively as the “Public Securities.” No Option Units shall be sold or delivered unless the Firm Units previously have been, or simultaneously are, sold and delivered. The right to purchase the Option Units, or any portion thereof, may be exercised from time to time and to the extent not previously exercised may be surrendered and terminated at any time upon notice by the Representative to the Company. The purchase price to be paid for each Option Unit will be the same price per Firm Unit set forth in Section 1.1.1 hereof.
1.2.2 Exercise of Option. The Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representative as to all (at any time) or any part (from time to time) of the Option Units within 45 days after the effective date (“Effective Date”) of the Registration Statement (as defined in Section 2.1.1 hereof). The Underwriters will not be under any obligation to purchase any Option Units prior to the exercise of the Over-allotment Option. The Over-allotment Option granted hereby may be exercised by the giving of oral notice to the Company by the Representative, which must be confirmed in writing by overnight mail or facsimile or other electronic transmission setting forth the number of Option Units to be purchased and the date and time for delivery of and payment for the Option Units (the “Option Closing Date”), which will not be later than five (5) full Business Days after the date of the notice or such other time and in such other manner as shall be agreed upon by the Company and the Representative, at the offices of EGS or at such other place (including remotely by facsimile or other electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Units does not occur on the Closing Date, the Option Closing Date will be as set forth in the notice. Upon exercise of the Over-allotment Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Units specified in such notice.
3 |
1.2.3 Payment and Delivery. Payment for the Option Units shall be made on the Option Closing Date at the Representative’s election by wire transfer in Federal (same day) funds or by certified or bank cashier’s check(s) in New York Clearing House funds, payable as follows: $10.00 per Option Unit shall be deposited in the Trust Account pursuant to the Trust Agreement upon delivery to the Underwriters of certificates (in form and substance satisfactory to the Underwriters) representing the Option Units (or through the facilities of DTC) for the account of the Underwriters. The amount deposited in the Trust Account shall include an aggregate of $0.30 per Option Unit (up to $450,000), payable to the Representative as a Deferred Underwriting Commission, in accordance with Section 1.3 hereof, in the Trust Account. The certificates representing the Option Units to be delivered will be in such denominations and registered in such names as the Representative requests in writing not less than two full Business Days prior to the Closing Date or the Option Closing Date, as the case may be, and will be made available to the Representative for inspection, checking and packaging at the aforesaid office of the Company’s transfer agent or correspondent not less than one full Business Day prior to such Closing Date. The Company shall not be obligated to sell or deliver the Option Units except upon tender of payment by the Representative for applicable Option Units.
1.3 Deferred Underwriting Commission. The Representative agrees that 3.00% of the gross proceeds from the sale of the Firm Units ($3,000,000) and the Option Units (up to $450,000) (the “Deferred Underwriting Commission”) will be deposited in and held in the Trust Account and payable directly from the Trust Account, without accrued interest. One Million Six Hundred Twenty-Five Thousand ($1,625,000) of the Deferred Underwriting Commission (plus up to $243,750 if the Over-allotment Option is exercised in full) shall be paid by the Company to the Representative in cash upon the closing of the Company’s Business Combination. The other One Million Three Hundred Seventy-Five Thousand ($1,375,000) of the Deferred Underwriting Commission (plus up to $206,250 if the Over-allotment Option is exercised in full) shall be payable by the Company in cash upon the closing of the Company’s Business Combination to certain parties who are instrumental in advising the Company in connection with the closing of the Business Combination, including the Representative, provided any such party is a member of the Financial Industry Regulatory Authority (“FINRA”), on either a contingent or non-contingent basis, as determined by the Company in its sole discretion; provided, however, that (1) any portion of the Deferred Underwriting Commission relating to an allocation made on a contingent basis where the contingency is not met shall not be paid to any party and (2) if no allocation is made by the Company with respect to any portion of the Deferred Underwriting Commission, then all of such unallocated portion of the Deferred Underwriting Commission shall be paid by the Company to the Representative. In the event that the Company is unable to consummate a Business Combination and CST, as the trustee of the Trust Account (in this context, the “Trustee”), commences liquidation of the Trust Account as provided in the Trust Agreement, the Representative, on behalf of itself and the other Underwriters, agrees that: (i) the several Underwriters shall forfeit any rights or claims to the Deferred Underwriting Commission; and (ii) the Deferred Underwriting Commission, together with all other amounts on deposit in the Trust Account, shall be distributed on a pro-rata basis among the Public Stockholders.
4 |
1.4 Private Placements.
1.4.1 In connection with the Company’s organization, the Company issued to its initial stockholders (the “Insider Stockholders”), for an aggregate consideration of $25,000, 2,875,000 shares of Common Stock in a private placement (the “Insider Private Placement”) exempt from registration under Section 4(2) of the Securities Act of 1933, as amended (the “Act”). On November 7, 2014, the Company effected a stock dividend of approximately 0.5 shares of Common Stock for each outstanding share of Common Stock, resulting in the Insider Stockholders owning an aggregate of 3,026,250 shares of Common Stock (the “Insider Shares”) (up to 382,500 of which are subject to forfeiture to the extent the Over-allotment Option is not exercised in full). No underwriting discounts, commissions or placement fees have been or will be payable in connection with the Insider Private Placement. Other than in a Permitted Transfer (as defined below), none of the Insider Shares may be sold, assigned or transferred by the Insider Stockholders until the earlier of: (i) with respect to 50% of such Insider Shares, the earlier of one year after the date of consummation of the Business Combination and the date on which the closing price of the Common Stock equals or exceeds $12.50 for any 20 trading days within a 30-trading pay period following the consummation of the Business Combination and (ii) with respect to the remaining 50% of such Insider Shares, one year after the date of the consummation of the Business Combination or earlier, in either case, if, subsequent to the Business Combination, the Company engages in a liquidation, merger, stock exchange or other similar transaction resulting in all of the Company’s stockholders having the right to exchange their shares for cash, securities or other property. The Insider Stockholders shall have no right to any liquidation distributions with respect to any portion of the Insider Shares in the event the Company fails to consummate a Business Combination. The Insider Stockholders shall not have redemption rights with respect to the Insider Shares. To the extent that the Over-allotment Option is not exercised by the Underwriters in full or in part, up to 382,500 of the Insider Shares shall be subject to forfeiture by the Insider Stockholders. The Insider Stockholders will be required to forfeit only such number of Insider Shares such that the Insider Shares will comprise 20% of the issued and outstanding shares of the Company after giving effect to the Offering and exercise, if any, of the Underwriters’ Over-allotment Option (and excluding the purchase of the Placement Units (as defined below) and any shares purchased by the Insider Stockholders in the Offering or in the aftermarket).
1.4.2 Simultaneously with the Closing Date, the Insider Stockholders will consummate the purchase from the Company pursuant to the Subscription Agreements (as defined in Section 2.23.2 hereof), an aggregate of 575,000 units (the “Placement Units”) at a purchase price of $10.00 per Placement Unit in a private placement intended to be exempt from registration under the Act pursuant to Section 4(a)(2) of the Act. The private placement of the Placement Unit is referred to herein as the “Unit Private Placement.” The warrants included in the Placement Units are referred to herein as the “Placement Warrants.” The Placement Units, the shares of Common Stock and Placement Warrants included in the Placement Units, and the shares of Common Stock issuable upon exercise of the Placement Warrants, are hereinafter referred to collectively as the “Placement Securities.” No underwriting discounts, commissions or placement fees have been or will be payable in connection with the Placement Units sold in the Unit Private Placement. The Insider Stockholders have also agreed that, in the event that the Over-allotment Option is exercised by the Underwriters, the Insider Stockholders will purchase up to 30,000 additional Placement Units, on a pro rata basis, in order that at least $10.00 per share sold to the public in the Offering is held in trust regardless of whether the Over-allotment Option is exercised in full or in part. The Placement Units are identical to the Firm Units except that the Placement Warrants will be non-redeemable by the Company and may be exercised on a cashless basis so long as they are held by the Insider Stockholders or their permitted transferees. None of the Placement Securities may be sold, assigned or transferred by the Insider Stockholders until after consummation of a Business Combination. The Public Securities, the Placement Securities and the Insider Shares are hereinafter referred to collectively as the “Securities.”
5 |
1.5 Working Capital; Interest on Trust.
1.5.1 Working Capital. Upon consummation of the Offering, initially $750,000 of the Offering proceeds will be released to the Company and held outside of the Trust Account to fund the working capital requirements of the Company.
1.5.2 Interest
Income. Prior to the Company’s consummation of a Business Combination or the Company’s liquidation, all
interest earned on the Trust Account may be released to the Company to pay income or any other taxes incurred by the Company, as
more fully described in the Prospectus. 2. Representations
and Warranties of the Company. The Company represents and warrants to the Underwriters as follows: 2.1 Filing
of Registration Statement. 2.1.1 Pursuant
to the Act. The Company has filed with the Commission a registration statement and amendments thereto, on Form S-1 (File No.
333-197330), including any related preliminary prospectus (“Preliminary Prospectus”), including any prospectus
that is included in the Registration Statement immediately prior to the effectiveness of the Registration Statement), for the registration
of the Units under the Act, which registration statement and amendment or amendments have been prepared by the Company in conformity
with the requirements of the Act, and the rules and regulations (the “Regulations”) of the Commission
under the Act. The conditions for use of Form S-1 to register the Offering under the Act, as set forth in the General Instructions
to such Form, have been satisfied. Except as the context may otherwise require, such registration statement, as amended, on file
with the Commission at the time the registration statement becomes effective (including the prospectus, financial statements, schedules,
exhibits and all other documents filed as a part thereof or incorporated therein and all information deemed to be a part thereof
as of such time pursuant to Rule 430A of the Regulations), is hereinafter called the “Registration Statement,”
and the form of the final prospectus dated the Effective Date included in the Registration Statement (or, if applicable, the form
of final prospectus containing information permitted to be omitted at the time of effectiveness by Rule 430A of the Regulations,
filed by the Company with the Commission pursuant to Rule 424 of the Regulations), is hereinafter called the “Prospectus.”
For purposes of this Agreement, “Time of Sale,” as used in the Act, means 5:00 p.m. New York City time,
on the date of this Agreement. Prior to the Time of Sale, the Company prepared a Preliminary Prospectus, which was included in
the Registration Statement filed on [October 10], 2014, for distribution by the Underwriters (such Preliminary Prospectus used
most recently prior to the Time of Sale, the “Sale Preliminary Prospectus”). If the Company has filed,
or is required pursuant to the terms hereof to file, a Registration Statement pursuant to Rule 462(b) under the Act registering
additional securities of any type or an amendment to a Registration Statement (a “Rule 462(b) Registration Statement”),
then, unless otherwise specified, any reference herein to the term “Registration Statement” shall be
deemed to include such Rule 462(b) Registration Statement. Other than a Rule 462(b) Registration Statement, which, if filed, becomes
effective upon filing, together with any correspondence letters between the Company and/or counsel for the Company and the Commission,
no other document with respect to the Registration Statement has heretofore been filed with the Commission. All of the Public Securities
have been registered for public sale under the Act pursuant to the Registration Statement or, if any Rule 462(b) Registration Statement
is filed, will be duly registered for public sale under the Act with the filing of such Rule 462(b) Registration Statement. The
Registration Statement has been declared effective by the Commission on the date hereof. If, subsequent to the date of this Agreement,
the Company or the Representative has determined that at the Time of Sale, the Sale Preliminary Prospectus includes an untrue statement
of a material fact or omitted a statement of material fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading and the Company and the Representative have agreed to provide an opportunity to purchasers
of the Units to terminate their old purchase contracts and enter into new purchase contracts, then the Sale Preliminary Prospectus
will be deemed to include any additional information available to purchasers at the time of entry into the first such new purchase
contract. 2.1.2 Pursuant
to the Exchange Act. The Company has filed with the Commission a Registration Statement on Form 8-A (File Number 001-_____)
providing for the registration under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
of the Units, the Common Stock and the Warrants. The registration of the Units, Common Stock and Warrants under the Exchange Act
has been declared effective by the Commission on the date hereof and the Units, the Common Stock and the Warrants have been registered
pursuant to Section 12(b) of the Exchange Act. 2.1.3 No
Stop Orders, Etc. Neither the Commission nor, to the Company’s knowledge, any federal, state or other regulatory authority
has issued any order or threatened to issue any order preventing or suspending the use of the Registration Statement, any Preliminary
Prospectus, the Sale Preliminary Prospectus or Prospectus or any part thereof, or has instituted or, to the Company’s knowledge,
threatened to institute any proceedings with respect to such an order. 2.2 Disclosures
in Registration Statement. 2.2.1 10b-5
Representation. At the time of effectiveness of the Registration Statement (or at the time any post-effective amendment to
the Registration Statement) and at all times subsequent thereto up to the Closing Date and the Option Closing Date, if any, the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus do and will contain all material statements that are
required to be stated therein in accordance with the Act and the Regulations, and did or will, in all material respects, conform
to the requirements of the Act and the Regulations. The Registration Statement, as of the effective date, did not, and the amendments
and supplements thereto, as of their respective dates, will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein, or necessary to make the statements therein, not misleading. The Prospectus, as
of its date and the Closing Date or the Option Closing Date, as the case may be, did not, and the amendments and supplements thereto,
as of their respective dates, will not, include any untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Sale
Preliminary Prospectus, as of the Time of Sale (or such subsequent Time of Sale pursuant to Section 2.1.1), did not include any
untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. When any Preliminary Prospectus or the Sale Preliminary
Prospectus was first filed with the Commission (whether filed as part of the Registration Statement for the registration of the
Public Securities or any amendment thereto or pursuant to Rule 424(a) of the Regulations) and when any amendment thereof or supplement
thereto was first filed with the Commission, such Preliminary Prospectus or the Sale Preliminary Prospectus and any amendments
thereof and supplements thereto complied or will have been corrected in the Sale Preliminary Prospectus and the Prospectus to comply
in all material respects with the applicable provisions of the Act and the Regulations and did not and will not contain an untrue
statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading. The representation and warranty
made in this Section 2.2.1 does not apply to statements made or statements omitted in reliance upon and in conformity with written
information furnished to the Company with respect to the Underwriters by the Representative expressly for use in the Registration
Statement, the Sale Preliminary Prospectus or the Prospectus or any amendment thereof or supplement thereto. The parties acknowledge
and agree that such information provided by or on behalf of any Underwriter consists solely of the names of the several Underwriters,
the information with respect to dealers’ concessions and reallowances contained in the section entitled “Underwriting
– Pricing of Securities,” and the identity of counsel to the Underwriters contained in the section entitled “Legal
Matters” (such information, collectively, the “Underwriters’ Information”). 2.2.2 Disclosure
of Agreements. The agreements and documents described in the Registration Statement, the Sale Preliminary Prospectus and the
Prospectus conform to the descriptions thereof contained therein and there are no agreements or other documents required to be
described in the Registration Statement, the Sale Preliminary Prospectus or the Prospectus or to be filed with the Commission
as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however
characterized or described) to which the Company is a party or by which its property or business is or may be bound or affected
and (i) that is referred to in the Registration Statement (or attached as an exhibit thereto), Sale Preliminary Prospectus or
the Prospectus, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company,
is in full force and effect and is enforceable against the Company and, to the Company’s knowledge, the other parties thereto,
in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar
laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may be
limited under the foreign, federal and state securities laws, and (z) that the remedy of specific performance and injunctive and
other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding
therefor may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor,
to the Company’s knowledge, any other party is in breach or default thereunder and, to the Company’s knowledge, no
event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a breach or default thereunder.
To the Company’s knowledge, the performance by the Company of the material provisions of such agreements or instruments
will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental
agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without
limitation, those relating to environmental laws and regulations. 2.2.3 Prior
Securities Transactions. No securities of the Company have been sold by the Company or by or on behalf of, or for the benefit
of, any person or persons controlling, controlled by, or under common control with the Company since the date of the Company’s
formation, except as disclosed in the Registration Statement. 2.2.4 Regulations.
The disclosures in the Registration Statement and the Sale Preliminary Prospectus and Prospectus concerning the effects of federal,
foreign, state and local regulation on the Company’s business as currently contemplated are correct in all material respects
and do not omit to state a material fact necessary to make the statements therein, in the light of the circumstances in which they
were made, not misleading. 2.3 Changes
After Dates in Registration Statement. 2.3.1 No
Material Adverse Change. Since the respective dates as of which information is given in the Registration Statement, the Sale
Preliminary Prospectus and the Prospectus, except as otherwise specifically stated therein, (i) there has been no material adverse
change in the condition, financial or otherwise, or business prospects of the Company, (ii) there have been no material transactions
entered into by the Company, other than as contemplated pursuant to this Agreement, (iii) no member of the Company’s board
of directors (the “Board of Directors”) or management has resigned from any position with the Company and (iv)
no event or occurrence has taken place which materially impairs, or would likely materially impair, with the passage of time, the
ability of the members of the Board of Directors or management to act in their capacities with the Company as described in the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus. 2.3.2 Recent
Securities Transactions. Subsequent to the respective dates as of which information is given in the Registration Statement,
the Sale Preliminary Prospectus and the Prospectus, and except as may otherwise be indicated or contemplated herein or therein,
the Company has not (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money;
or (ii) declared or paid any dividend or made any other distribution on or in respect to its equity securities. 2.4 Independent
Accountants. To the Company’s knowledge, Marcum LLP (“Marcum”), whose report is filed with the Commission
as part of the Registration Statement, the Sale Preliminary Prospectus and the Prospectus and included in the Registration Statement,
the Sale Preliminary Prospectus and the Prospectus, are independent registered public accountants as required by the Act and the
Regulations. To the Company’s knowledge, Marcum is currently registered with the Public Company Accounting Oversight Board
(“PCAOB”) and is currently in good standing with the PCAOB. Marcum has not, during the periods covered by the
financial statements included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, provided to the
Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act. 2.5 Financial
Statements; Statistical Data. 2.5.1 Financial
Statements. The financial statements, including the notes thereto and supporting schedules (if any) included in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus fairly present the financial position, the results of operations
and the cash flows of the Company at the dates and for the periods to which they apply; such financial statements have been prepared
in conformity with United States generally accepted accounting principles (“GAAP”), consistently applied throughout
the periods involved; and the supporting schedules included in the Registration Statement, the Sale Preliminary Prospectus and
the Prospectus present fairly the information required to be stated therein in conformity with the Regulations. No other financial
statements or supporting schedules are required to be included or incorporated by reference in the Registration Statement, the
Sale Preliminary Prospectus or the Prospectus. The Registration Statement, the Sale Preliminary Prospectus and the Prospectus disclose
all material off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships
of the Company with unconsolidated entities or other persons that may have a material current or future effect on the Company’s
financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital resources,
or significant components of revenues or expenses. There are no pro forma or as adjusted financial statements that are required
to be included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus in accordance with Regulation
S-X or Form 10 that have not been included as required. 2.5.2 Statistical
Data. The statistical, industry-related and market-related data included in the Registration Statement, the Sale Preliminary
Prospectus and/or the Prospectus are based on or derived from sources that the Company reasonably and in good faith believes are
reliable and accurate, and such data materially agree with the sources from which they are derived. 2.6 Authorized
Capital; Options. The Company had at the date or dates indicated in each of the Registration Statement, the Sale Preliminary Prospectus
and the Prospectus, as the case may be, duly authorized, issued and outstanding capitalization as set forth in the Registration
Statement, the Sale Preliminary Prospectus, and the Prospectus. Based on the assumptions stated in the Registration Statement,
the Sale Preliminary Prospectus, and the Prospectus, the Company will have on the Closing Date the adjusted stock capitalization
set forth therein. Except as set forth in, or contemplated by the Registration Statement, the Sale Preliminary Prospectus and the
Prospectus, on the Effective Date and on the Closing Date, there will be no options, warrants, or other rights to purchase or otherwise
acquire any authorized but unissued Common Stock or any security convertible into Common Stock, or any contracts or commitments
to issue or sell Common Stock or any such options, warrants, rights or convertible securities. 2.7 Valid
Issuance of Securities. 2.7.1 Outstanding
Securities. All issued and outstanding securities of the Company issued prior to the transactions contemplated by this Agreement
have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights of rescission
with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities was
issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted
by the Company. The authorized and outstanding Common Stock conforms in all material respects to all statements relating thereto
contained in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus. All offers and sales and any transfers
of the outstanding securities of the Company were at all relevant times either registered under the Act and the applicable state
securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers of such securities, exempt
from such registration requirements. 2.7.2 Securities
Sold Pursuant to this Agreement. The Securities have been duly authorized and reserved for issuance and when issued and paid
for in accordance with this Agreement, will be validly issued, fully paid and non-assessable; the holders thereof are not and
will not be subject to personal liability by reason of being such holders; the Securities are not and will not be subject to the
preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company; and all
corporate action required to be taken for the authorization, issuance and sale of the Securities has been duly and validly taken.
The form of certificates for the Securities conform to the corporate law of the jurisdiction of the Company’s incorporation.
The Securities conform in all material respects to the descriptions thereof contained in the Registration Statement, the Sale
Preliminary Prospectus and the Prospectus, as the case may be. When paid for and issued, the Warrants will constitute valid and
binding obligations of the Company to issue and sell, upon exercise thereof and payment of the respective exercise prices therefor,
the number and type of securities of the Company called for thereby in accordance with the terms thereof and such Warrants are
enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of
any indemnification or contribution provision may be limited under foreign, federal and state securities laws; and (iii) that
the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses
and to the discretion of the court before which any proceeding therefor may be brought. The shares of Common Stock issuable upon
exercise of the Warrants have been reserved for issuance upon the exercise of such securities and upon payment of the consideration
therefor, and when issued in accordance with the terms thereof, such Common Stock will be duly and validly authorized, validly
issued, fully paid and non-assessable, and the holders thereof are not and will not be subject to personal liability by reason
of being such holders. 2.7.3 Placement
Units and Placement Warrants. The Placement Units and the Placement Warrants constitute valid and binding obligations of the
Company to issue and sell, upon exercise thereof and payment of the respective exercise prices therefor, the number and type of
securities of the Company called for thereby in accordance with the terms thereof, and such Placement Units and Placement Warrants
are enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited
by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of
any indemnification or contribution provision may be limited under federal and state securities laws; and (iii) that the remedy
of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought. The shares of Common Stock issuable upon exercise
of the Placement Warrants have been reserved for issuance upon the exercise of the Placement Warrants and, when issued in accordance
with the terms of the Placement Warrants, will be duly and validly authorized, validly issued, fully paid and non-assessable, and
the holders thereof are not and will not be subject to personal liability by reason of being such holders. 2.7.4 No
Integration. Neither the Company nor any of its affiliates has, prior to the date hereof, made any offer or sale of any securities
which are required to be or may be “integrated” pursuant to the Act or the Regulations with the offer and sale
of the Securities pursuant to the Registration Statement. 2.8 Registration
Rights of Third Parties. Except as set forth in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus,
no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities of the
Company have the right to require the Company to register any such securities of the Company under the Act or to include any such
securities in a registration statement to be filed by the Company. 2.9 Validity
and Binding Effect of Agreements. This Agreement, the Warrant Agreement (as defined in Section 2.21 hereof), the Trust Agreement,
the Administrative Services Agreement (as defined in Section 3.7.3 hereof), the Escrow Agreement (as defined in Section 2.22.3
hereof), the Registration Rights Agreement (as defined in Section 2.22.4) and the Subscription Agreements (as defined in Section
2.22.2 hereof) have been duly and validly authorized by the Company and, when executed and delivered, will constitute the valid
and binding agreements of the Company, enforceable against the Company in accordance with their respective terms, except: (i) as
such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights
generally, (ii) as enforceability of any indemnification or contribution provision may be limited under the foreign, federal and
state securities laws, and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may
be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. 2.10 No
Conflicts, Etc. The execution, delivery, and performance by the Company of this Agreement, the Warrant Agreement, the Trust Agreement,
the Administrative Services Agreement, the Escrow Agreement, the Registration Rights Agreement and the Subscription Agreements,
the consummation by the Company of the transactions herein and therein contemplated and the compliance by the Company with the
terms hereof and thereof do not and will not, with or without the giving of notice or the lapse of time or both: (i) result in
a breach or violation of, or conflict with any of the terms and provisions of, or constitute a default under, or result in the
creation, modification, termination or imposition of any lien, charge or encumbrance upon any property or assets of the Company
pursuant to the terms of any agreement, obligation, condition, covenant or instrument to which the Company is a party or bound
or to which its property is subject except pursuant to the Trust Agreement; (ii) result in any violation of the provisions of the
Amended and Restated Certificate of Incorporation and Bylaws, as amended, of the Company; or (iii) violate any existing applicable
statute, law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction
over the Company or any of its properties, business or assets constituted as of the date hereof. 2.11 No
Defaults; Violations. No default or violation exists in the due performance and observance of any term, covenant or condition
of any license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument
evidencing an obligation for borrowed money, or any other agreement or instrument to which the Company is a party or by which
the Company may be bound or to which any of the properties or assets of the Company is subject. The Company is not in violation
of any term or provision of its Amended and Restated Certificate of Incorporation and Bylaws, as amended, or in violation of any
franchise, license, permit, applicable law, rule, regulation, judgment or decree of any governmental agency or court, domestic
or foreign, having jurisdiction over the Company or any of its properties or businesses. 2.12 Corporate
Power; Licenses; Consents. 2.12.1 Conduct
of Business. The Company has all requisite corporate power and authority, and has all necessary authorizations, approvals,
orders, licenses, certificates and permits of and from all governmental regulatory officials and bodies that it needs as of the
date hereof to conduct its business for the purposes as described in the Registration Statement, the Sale Preliminary Prospectus
and the Prospectus. The disclosures in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus concerning
the effects of foreign, federal, state and local regulation on this Offering and the Company’s business purpose as currently
contemplated are correct in all material respects and do not omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Since its formation,
the Company has conducted no business and has incurred no liabilities other than in connection with its formation and in furtherance
of this Offering. 2.12.2 Transactions
Contemplated Herein. The Company has all requisite corporate power and authority to enter into this Agreement and to carry
out the provisions and conditions hereof, and all consents, authorizations, approvals and orders required in connection therewith
have been obtained. No consent, authorization or order of, and no filing with, any court, government agency or other body, foreign
or domestic, is required for the valid issuance, sale and delivery, of the Securities and the consummation of the transactions
and agreements contemplated by this Agreement, the Warrant Agreement, the Trust Agreement, the Administrative Services Agreement,
the Escrow Agreement, the Registration Rights Agreement and the Subscription Agreements and as contemplated by the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus, except with respect to applicable foreign, federal and state securities
laws and the rules and regulations promulgated by FINRA. 2.12.3 Jurisdiction
and Designation. The Company has the power to submit, and pursuant to Section 10.7 of this Agreement has, to the extent permitted
by law, legally, validly, effectively and irrevocably submitted, to the jurisdiction of any New York State or United States Federal
court sitting in The City of New York, Borough of Manhattan. 2.13 D&O
Questionnaires. To the Company’s knowledge, all information contained in the questionnaires (the “Questionnaires”)
completed by each of the Company’s officers, directors, and Insider Stockholders (collectively, “Insiders”)
and provided to the Representative, as such Questionnaires may have been updated from time to time and confirmed by each of the
Insiders, and the biographies of the Insiders (to the extent a biography is included) contained in the Registration Statement,
Sale Preliminary Prospectus and the Prospectus is true and correct and the Company has not become aware of any information which
would cause the information disclosed in the Questionnaires completed by each Insider to become inaccurate, incorrect or incomplete. 2.14 Litigation;
Governmental Proceedings. There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or governmental
proceeding pending, or to the Company’s knowledge, threatened against or involving the Company or any Insider or any stockholder
or member of an Insider that has not been disclosed or that is required to be disclosed, in the Registration Statement, the Sale
Preliminary Prospectus, the Prospectus or the Questionnaires. 2.15 Good
Standing. The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws of
the jurisdiction of incorporation. The Company is duly qualified to do business and is in good standing as a foreign corporation
in each jurisdiction in which its ownership or lease of property or the conduct of business requires such qualification, except
where the failure to qualify would not have a material adverse effect on the assets, business or operations of the Company (a
“Material Adverse Effect”). 2.16 No
Contemplation of a Business Combination. Prior to the date hereof, no Company Affiliate (as defined in Section 2.17.3) has, and
as of the Closing Date, the Company and such Company Affiliates will not have: (a) had any specific Business Combination under
consideration or contemplation; (b) directly or indirectly, contacted any potential operating assets, business or businesses that
the Company may seek to consummate a Business Combination with (each, a “Target Business”) or any owner, officer,
director, manager, agent or representative thereof or had any substantive discussions, formal or otherwise, with respect to effecting
any potential Business Combination with the Company or taken any measure, directly or indirectly to locate a Target Business; or
(c) engaged or retained any agent or other representative to identify or locate any Target Business for the Company. 2.17 Transactions
Affecting Disclosure to FINRA. 2.17.1 Finder’s
Fees. There are no claims, payments, arrangements, agreements or understandings relating to the payment of a finder’s,
consulting or origination fee by the Company or any Insider with respect to the sale of the Securities hereunder or any other arrangements,
agreements or understandings of the Company or, to the Company’s knowledge, any Insider that may affect the Underwriters’
compensation, as determined by FINRA. 2.17.2 Payments
Within 180 Days. The Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person,
as a finder’s fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing
to the Company persons who raised or provided capital to the Company; (ii) any FINRA member; or (iii) any person or entity that
has any direct or indirect affiliation or association with any FINRA member, within the 180-day period prior to the initial filing
date of the Registration Statement, other than the prior payments to the Representative described in the Registration Statement
and the Prospectus and payment to the Underwriters as provided hereunder in connection with the Offering. 2.17.3 FINRA
Affiliation. Except with respect to Eric Rosenfeld’s affiliation with Canaccord Genuity, no Officer or Director or any
beneficial owner (including the Insiders) of any class of the Company’s unregistered securities (whether debt or equity,
registered or unregistered, regardless of the time acquired or the source from which derived) has any direct or indirect affiliation
or association with any FINRA member (as determined in accordance with the rules and regulations of FINRA). The Company will advise
the Representative and EGS if it learns that any officer, director or owner of at least 5% of the Company’s outstanding
Common Stock (or securities convertible into Common Stock) (any such individual or entity, a “Company Affiliate”)
is or becomes an affiliate or associated person of a FINRA member participating in the Offering. 2.17.4 No
Company Affiliate is an owner of stock or other securities of any member of FINRA (other than securities purchased on the open
market). 2.17.5 No
Company Affiliate has made a subordinated loan to any member of FINRA. 2.17.6 No
proceeds from the sale of the Public Securities (excluding underwriting compensation) or the Placement Units, will be paid to any
FINRA member, or any persons associated or affiliated with a member of FINRA, except as specifically authorized herein. 2.17.7 The
Company has not issued any warrants or other securities, or granted any options, directly or indirectly to anyone who is a potential
underwriter in the Offering or a related person (as defined by FINRA rules) of such an underwriter within the 180-day period prior
to the initial filing date of the Registration Statement. 2.17.8 No
person to whom securities of the Company have been privately issued within the 180-day period prior to the initial filing date
of the Registration Statement has any relationship or affiliation or association with any member of FINRA. 2.17.9 To
the Company’s knowledge, no FINRA member intending to participate in the Offering has a conflict of interest with the Company.
For this purpose, a “conflict of interest” exists when a member of FINRA and/or its associated persons,
parent or affiliates in the aggregate beneficially own 10% or more of the Company’s outstanding subordinated debt or common
equity, or 10% or more of the Company’s preferred equity. “Members participating in the Offering”
include managing agents, syndicate group members and all dealers which are members of FINRA. 2.17.10 Except
with respect to the Representative in connection with the Offering, the Company has not entered into any agreement or arrangement
(including, without limitation, any consulting agreement or any other type of agreement) during the 180-day period prior to the
initial filing date of the Registration Statement, which arrangement or agreement provides for the receipt of any item of value
and/or the transfer or issuance of any warrants, options, or other securities from the Company to a FINRA member, any person associated
with a member (as defined by FINRA rules), any potential underwriters in the Offering and/or any related persons. 2.18 Taxes. 2.18.1 There
are no transfer taxes or other similar fees or charges under Delaware law, U.S. federal law or the laws of any U.S. state or any
political subdivision of Delaware or the United States, required to be paid in connection with the execution and delivery of this
Agreement or the issuance or sale by the Company of the Public Securities. 2.18.2 The
Company has filed all non-U.S., U.S. federal, state and local tax returns required to be filed with taxing authorities prior to
the date hereof in a timely manner or has duly obtained extensions of time for the filing thereof. The Company has paid all taxes
shown as due on such returns that were filed and has paid all taxes imposed on it and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable. The Company has made appropriate provisions in the applicable
financial statements referred to in Section 2.5.1 above in respect of all federal, state, local and foreign income and franchise
taxes for all current or prior periods as to which the tax liability of the Company has not been finally determined. 2.18.3 Except
for any income or franchise taxes imposed on the Underwriters by Delaware or the United States or any political subdivision or
taxing authority thereof or therein as a result of any present or former connection between the Underwriters and the jurisdiction
imposing such tax, no value added tax will have to be charged by the Company and no stamp or other issuance or transfer taxes or
duties and no capital gains, income, withholding or other taxes are payable by or on behalf of the Underwriters to Delaware or
the United States or any political subdivision or taxing authority thereof or therein, in connection with (i) the issuance and
authentication of the Securities; (ii) the sale of the Securities to the Underwriters in the manner contemplated herein; or (iii)
the resale and delivery of such Securities by the Underwriters in the manner contemplated in the Sale Preliminary Prospectus and
the Prospectus. 2.19 Foreign
Corrupt Practices Act; Anti-Money Laundering; Patriot Act 2.19.1 Foreign
Corrupt Practices Act. Neither the Company nor to the Company’s knowledge any of the Insiders or any other person acting
on behalf of the Company has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal
price concessions to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or
supplier, or official or employee of any governmental agency or instrumentality of any government (domestic or foreign) or any
political party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder
the business of the Company (or assist it in connection with any actual or proposed transaction) that (i) might subject the Company
to any damage or penalty in any civil, criminal or governmental litigation or proceeding, (ii) if not given in the past, might
have had a Material Adverse Effect, or (iii) if not continued in the future, might adversely affect the assets, business or operations
of the Company. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to
cause the Company to comply in all material respects with the Foreign Corrupt Practices Act of 1977, as amended. 2.19.2 Currency
and Foreign Transactions Reporting Act. The operations of the Company are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transaction Reporting Act of 1970,
as amended, including the Money Laundering Control Act of 1986, as amended, the rules and regulations thereunder and any related
or similar money laundering statutes, rules, regulations or guidelines, issued, administered or enforced by any Federal governmental
agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court
or governmental agency, authority or body or any arbitrator involving the Company with respect to the Money Laundering Laws is
pending or, to the Company’s knowledge, threatened. 2.19.3 Bank
Secrecy Act; Patriot Act. Neither the Company nor to the Company’s knowledge, any Company Affiliate has violated: (i)
the Bank Secrecy Act of 1970, as amended, or (ii) the Uniting and Strengthening of America by Providing Appropriate Tools Required
to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, and/or the rules and regulations promulgated under any such
law, or any successor law. 2.20 Officers’
Certificate. Any certificate signed by any duly authorized officer or officers of the Company in connection with the Offering and
delivered to the Representative or to EGS shall be deemed a representation and warranty by the Company to the Underwriters as to
the matters covered thereby. 2.21 Warrant
Agreement. The Company has entered into a warrant agreement with respect to the Warrants and Placement Warrants with CST substantially
in the form filed as an exhibit to the Registration Statement (“Warrant Agreement”). 2.22 Agreements
With Insiders. 2.22.1 Insider
Letters. The Company has caused to be duly executed legally binding and enforceable agreements (except (i) as such enforceability
may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (ii) as enforceability
of any indemnification, contribution or noncompete provision may be limited under foreign, federal and state securities laws, and
(iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable
defenses and to the discretion of the court before which any proceeding therefor may be brought), a form of which is annexed as
an exhibit to the Registration Statement (“Insider Letter”), pursuant to which each of the Insiders of the Company
agree to certain matters as described in the Registration Statement, including restrictions on the transfer of the Insider Shares
and Placement Units. 2.22.2 Subscription
Agreements. The Insider Stockholders have executed and delivered subscription agreements, the form of which is annexed as
an exhibit to the Registration Statement (the “Subscription Agreements”), pursuant to which the
Insider Stockholders will, among other things, on the Closing Date, purchase and deliver the purchase price for an aggregate
of 575,000 Placement Units, in the Unit Private Placement. Pursuant to the Subscription Agreements, (i) each of the Insider
Stockholders has waived any and all rights and claims they may have to any proceeds, and any interest thereon, held in the
Trust Account in respect of the Placement Securities, and (ii) $5,750,000 of the proceeds from the sale of the Placement
Units have been deposited into an escrow account maintained by Graubard Miller (“Graubard”), who has irrevocable instructions to deposit such funds in the Trust Account in accordance with the terms of the Trust Agreement on the
Closing Date. 2.22.3 Escrow
Agreement. The Company has caused the Insider Stockholders to enter into an escrow agreement (the “Escrow Agreement”)
with CST, substantially in the form filed as an exhibit to the Registration Statement whereby Insider Shares will be held in escrow
by CST for a period (the “Escrow Period”) commencing on the Effective Date and expiring (i) with respect to
50% of the Insider Shares, on the earlier of the one year anniversary of the consummation of the Business Combination and the
date on which the closing price of the Common Stock exceeds $12.50 per share for any 20 trading days within a 30 trading day period
following the consummation of the Business Combination, and (ii) with respect to the remaining 50% of the Insider Shares, on the
one year anniversary of the consummation of the Business Combination, or earlier in each case in certain limited situations. During
the Escrow Period, such parties shall be prohibited from selling or otherwise transferring such Insider Shares, except in certain
limited circumstances set forth in the Escrow Agreement. The Escrow Agreement is enforceable against the Insider Stockholders
and will not, with or without the giving of notice or the lapse of time or both, result in a breach of, or conflict with, any
of the terms and provisions of, or constitute a default under, an agreement or instrument to which any of the Insider Stockholders
are a party. 2.22.4 Registration
Rights Agreement. The Company and the Insider Stockholders have entered into a Registration Rights Agreement (“Registration
Rights Agreement”) substantially in the form annexed as an exhibit to the Registration Statement, whereby such parties
will be entitled to certain registration rights with respect to the securities they hold or may hold, as set forth in such Registration
Rights Agreement and described more fully in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus. 2.22.5 Loans.
Certain Insiders of the Company have made loans to the Company in the aggregate amount of $50,000 (the “Insider Loans”)
pursuant to promissory notes substantially in the form annexed as an exhibit to the Registration Statement. The Insider Loans do
not bear any interest and are repayable by the Company on the consummation of the Offering. 2.23 Investment
Management Trust Agreement. The Company has entered into the Trust Agreement with respect to certain proceeds of the Offering and
the Unit Private Placement substantially in the form annexed as an exhibit to the Registration Statement, pursuant to which the
funds held in the Trust Account may be released under limited circumstances. 2.24 No
Existing Non-Competition Agreements. No Insider is subject to any non-competition agreement or non-solicitation agreement with
any employer or prior employer which could materially affect his ability to be an employee, officer and/or director of the Company,
except as disclosed in the Registration Statement. No officer or director of the Company is subject to any non-competition agreement
or non-solicitation agreement with any employer or prior employer that could materially affect each respective director’s
or officer’s ability to be and act in the capacity of a director or officer of the Company, except as disclosed in the Registration
Statement. 2.25 Investments.
No more than 45% of the “value” (as defined in Section 2(a)(41) of the Investment Company Act of 1940,
as amended (“Investment Company Act”)) of the Company’s total assets consist of, and no more than 45%
of the Company’s net income after taxes is derived from, securities other than “Government Securities” (as defined
in Section 2(a)(16) of the Investment Company Act) or money market funds meeting certain conditions under Rule 2a-7 of the Investment
Company Act. 2.26 Investment
Company Act. The Company is not required, and upon the issuance and sale of the Securities as herein contemplated and the application
of the net proceeds therefrom as described in the Sale Preliminary Prospectus and Prospectus will not be required, to register
as an “investment company” under the Investment Company Act. 2.27 Subsidiaries.
The Company does not own an interest in any corporation, partnership, limited liability company, joint venture, trust or other
business entity. 2.28 Related
Party Transactions. No relationship, direct or indirect, exists between or among any of the Company or any Company Affiliate, on
the one hand, and any director, officer, stockholder, customer or supplier of the Company or any Company Affiliate, on the other
hand, which is required by the Act, the Exchange Act or the Regulations to be described in the Registration Statement, the Sale
Preliminary Prospectus and the Prospectus which is not so described as required. There are no outstanding loans, advances (except
normal advances for business expenses in the ordinary course of business) or guarantees of indebtedness by the Company to or for
the benefit of any of the officers or directors of the Company or any of their respective family members, except as disclosed in
the Registration Statement, the Sale Preliminary Prospectus and the Prospectus. The Company has not extended or maintained credit,
arranged for the extension of credit, or renewed an extension of credit, in the form of a personal loan to or for any director
or officer of the Company. 2.29 No
Influence. The Company has not offered, or caused the Underwriters to offer, the Firm Units to any person or entity with the intention
of unlawfully influencing: (a) a customer or supplier of the Company or any affiliate of the Company to alter the customer’s
or supplier’s level or type of business with the Company or such affiliate or (b) a journalist or publication to write or
publish favorable information about the Company or any such affiliate. 2.30 Sarbanes-Oxley.
The Company is in material compliance with the provisions of the Sarbanes-Oxley Act of 2002, as amended, and the rules and regulations
promulgated thereunder and related or similar rules or regulations promulgated by any governmental or self-regulatory entity or
agency, that are applicable to it as of the date hereof. 2.31 Distribution
of Offering Material by the Company. The Company has not distributed and will not distribute, prior to the later of the Closing
Date and the completion of the Underwriters’ distribution of the Units, any offering material in connection with the offering
and sale of the Units other than the Sale Preliminary Prospectus and the Prospectus, in each case as supplemented and amended. 2.32 NASDAQ.
The Public Securities have been authorized for listing, subject to official notice of issuance and evidence of satisfactory distribution,
on the NASDAQ Capital Market, and the Company knows of no reason or set of facts that is likely to adversely affect such authorization. 2.33 Board
of Directors. As of the Effective Date, the Board of Directors of the Company will be comprised of the persons set forth under
the heading of the Sale Preliminary Prospectus and the Prospectus captioned “Management.” As of the Effective Date,
the qualifications of the persons serving as board members and the overall composition of the board will comply with the Sarbanes-Oxley
Act of 2002 and the rules promulgated thereunder and the rules of the NASDAQ Capital Market that are, in each case, applicable
to the Company. As of the Effective Date, the Company will have an Audit Committee that satisfies the applicable requirements under
the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and the rules of the NASDAQ Capital Market. 2.34 Emerging
Growth Company. From its formation through the date hereof, the Company has been and is an “emerging growth company,”
as defined in Section 2(a) of the Act (an “Emerging Growth Company”). 2.35 Testing-The-Waters
Communications. The Company (a) has not engaged in any Testing-the-Waters Communication and (b) has not authorized anyone to engage
in Testing-the-Waters Communications. “Testing-the-Waters Communication” means any oral or written communication with
potential investors undertaken in reliance on Section 5(d) of the Act. 2.36 No
Disqualification Events. Neither the Company, nor any of its predecessors or any affiliated issuer, nor any director, executive
officer, or other officer of the Company participating in the Offering, nor any beneficial owner of 20% or more of the Company’s
outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule
405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, a “Company
Covered Person” and, together, “Company Covered Persons”)
is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities
Act (a “Disqualification Event”), except for a Disqualification Event covered
by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Company Covered Person is subject
to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e),
and has furnished to the Representative a copy of any disclosures provided thereunder. 2.37 Other
Covered Persons. The Company is not aware of any person (other than any Company Covered Person) that has been or will be paid (directly
or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Securities. 2.38 Notice
of Disqualification Events. The Company will notify the Representative in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Company Covered Person and (ii) any event that would, with the passage of time, become a Disqualification
Event relating to any Company Covered Person. 3. Covenants
of the Company. The Company covenants and agrees as follows: 3.1 Amendments
to Registration Statement. The Company will deliver to the Representative, prior to filing, any amendment or supplement to the
Registration Statement, any Preliminary Prospectus or the Prospectus proposed to be filed after the Effective Date and the Company
shall not file any such amendment or supplement to which the Representative shall reasonably object in writing. 3.2 Federal
Securities Laws. 3.2.1 Compliance.
During the time when a Prospectus is required to be delivered under the Act, the Company will use its best efforts to comply with
all requirements imposed upon it by the Act, the Regulations and the Exchange Act and by the regulations under the Exchange Act,
as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Securities in accordance
with the provisions hereof and the Sale Preliminary Prospectus and the Prospectus. If at any time when a Prospectus relating to
the Securities is required to be delivered under the Act, any event shall have occurred as a result of which, in the opinion of
counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement
of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend or supplement
the Prospectus to comply with the Act, the Company will notify the Representative promptly and prepare and file with the Commission,
subject to Section 3.1 hereof, an appropriate amendment or supplement in accordance with Section 10 of the Act. 3.2.2 Filing
of Final Prospectus. The Company will file the Prospectus (in form and substance satisfactory to the Representative) with the
Commission pursuant to the requirements of Rule 424 of the Regulations. 3.2.3 Exchange
Act Registration. The Company will use its best efforts to maintain the registration of the Public Securities under the provisions
of the Exchange Act (except in connection with a going-private transaction) for a period of five years from the Effective Date,
or until the Company is required to be liquidated or is acquired, if earlier, or, in the case of the Warrants, until the Warrants
expire and are no longer exercisable. The Company will not deregister the Public Securities under the Exchange Act without the
prior written consent of the Representative. 3.2.4 Exchange
Act Filings. From the Effective Date until the earlier of the Company’s initial Business Combination, or its liquidation
and dissolution, the Company shall timely file with the Commission via the Electronic Data Gathering, Analysis and Retrieval System
(“EDGAR”) such statements and reports as are required to be filed by a company registered under Section 12(b)
of the Exchange Act. 3.2.5 Sarbanes-Oxley
Compliance. As soon as it is legally required to do so, the Company shall take all actions necessary to obtain and thereafter
maintain material compliance with each applicable provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated
thereunder and related or similar rules and regulations promulgated by any other governmental or self-regulatory entity or agency
with jurisdiction over the Company. 3.3 Free-Writing
Prospectus and Testing the Waters. The Company represents and agrees that it has not made and will not make any offer relating
to the Public Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 under the Act, or that
would otherwise constitute a “free writing prospectus” as defined in Rule 405, without the prior consent of the Representative.
Any such free writing prospectus consented to by the Representative is hereinafter referred to as a “Permitted Free Writing
Prospectus.” The Company represents that it will treat each Permitted Free Writing Prospectus as an “issuer free writing
prospectus,” as defined in Rule 433, and has complied with and will comply with the applicable requirements of Rule 433
of the Act, including timely Commission filing where required, legending and record keeping. The Company (a) will not engage in
any Testing the Waters Communication and (b) will not authorize anyone to engage in Testing the Waters Communications, without
the prior written consent of the Representative. 3.4 Emerging
Growth Company Status. The Company will promptly notify the Representative if the Company ceases to be an Emerging Growth Company
at any time prior to the earlier of five years after the consummation of the Company’s Business Combination, or the liquidation
of the Trust Account if a Business Combination is not consummated by the Termination Date. 3.5 Delivery
to Underwriters of Prospectuses. The Company will deliver to each of the Underwriters, without charge and from time to time during
the period when the Prospectus is required to be delivered under the Act or the Exchange Act, such number of copies of each Preliminary
Prospectus and the Prospectus as such Underwriters may reasonably request and, as soon as the Registration Statement or any amendment
or supplement thereto becomes effective, deliver to the Representative, upon its request, the two manually executed Registration
Statements, including exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated
therein by reference and all manually executed consents of certified experts. 3.6 Effectiveness
and Events Requiring Notice to the Representative. The Company will use its best efforts to cause the Registration Statement to
remain effective and will notify the Representative immediately and confirm the notice in writing: (i) of the effectiveness of
the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment thereto or preventing or suspending the use of any Preliminary Prospectus
or the Prospectus or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any foreign
or state securities commission of any proceedings for the suspension of the qualification of the Public Securities for offering
or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and
delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt
of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the
period described in Section 3.5 hereof that, in the judgment of the Company, makes any statement of a material fact made in the
Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the
Prospectus in order to make the statements therein, and in light of the circumstances under which they were made, not misleading.
If the Commission or any foreign or state securities commission shall enter a stop order or suspend such qualification at any time,
the Company will make every reasonable effort to obtain promptly the lifting of such order. 3.7 Affiliated
Transactions. 3.7.1 Business
Combinations. The Company will not consummate a Business Combination with any entity that is affiliated with any Insider unless (i)
the Company obtains an opinion from an independent investment banking firm or another independent entity reasonably acceptable
to the Representative that the Business Combination is fair to the Company’s stockholders from a financial perspective and (ii) such transaction is approved
by a majority of the Companys disinterested independent directors. No
Insider or any affiliate of an Insider shall receive any fees of any type (other than reimbursement of ordinary and customary expenses
incurred on behalf of the Company) in connection with any Business Combination. 3.7.2 Compensation
to Insiders. Except as set forth in this Section 3.7.3 or as otherwise disclosed in the Prospectus, the Company shall not pay
any of the Insiders or any of their affiliates any fees or compensation for services rendered to the Company prior to, or in connection
with, the consummation of a Business Combination; provided that the Insiders shall be entitled to reimbursement from the Company
for their reasonable out-of-pocket expenses incurred in connection with seeking and consummating a Business Combination. 3.7.3 Administrative
Services Agreement. The Company has entered into an agreement (the “Administrative Services Agreement”)
with Crescendo Advisors II, LLC, an entity controlled by the Company’s Chief Executive Officer, pursuant to which such entity
will make available to the Company general and administrative services including office space, utilities and secretarial support
for the Company’s use for an aggregate of $12,500 per month, payable until the consummation by the Company of a Business
Combination or the distribution of the Trust Account. The Company shall not enter into any other arrangement for the provision
of such services with any Insiders or their affiliates that will require the Company to pay in excess of $12,500 per month for
such services. 3.8 Financial
Public Relations Firm. Promptly after the execution of a definitive agreement for a Business Combination, the Company shall retain
a financial public relations firm reasonably acceptable to the Representative for a term to be agreed on by the Company and the
Representative. 3.9 Reports
to the Representative. For a period of five years from the Effective Date or until such earlier time upon which the Company is
required to be liquidated, the Company will furnish to the Representative and its counsel copies of such financial statements and
other periodic and special reports as the Company from time to time furnishes generally to holders of any class of its securities,
and promptly furnish to the Representative: (i) a copy of each periodic report the Company shall be required to file with the Commission,
(ii) a copy of every press release and every news item and article with respect to the Company or its affairs that was released
by the Company, (iii) a copy of each current Report on Form 8-K or Schedules 13D, 13G, 14D-1 or 13E-4 received or prepared by the
Company, (iv) two (2) copies of each registration statement filed by the Company with the Commission under the Act, and (v) such
additional documents and information with respect to the Company and the affairs of any future subsidiaries of the Company as the
Representative may from time to time reasonably request; provided the Representative shall sign, if requested by the Company, a
Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representative and its counsel in connection
with the Representative’s receipt of such information. Documents filed with the Commission pursuant to its EDGAR system shall
be deemed to have been delivered to the Representative pursuant to this Section. 3.10 Transfer
Agent. For a period of five years following the Effective Date or until such earlier time upon which the Company is required to
be liquidated (or the Warrants expire), the Company shall retain a transfer agent and warrant agent acceptable to the Representative. 3.11 Disqualification
of S-1. Until the earlier of seven years from the date hereof or until the Warrants have either expired and are no longer
exercisable or have all been exercised, the Company will not take any action or actions which may prevent or disqualify the Company’s
use of Form S-1 or S-3 (or other appropriate form) for the registration of the Common Stock issuable upon exercise of the Warrants
under the Act. 3.12 Payment
of Expenses. The Company hereby agrees to pay on each of the Closing Date and the Option Closing Date, if any, to the extent not
paid at Closing Date, all Company expenses incident to the performance of the obligations of the Company under this Agreement,
including, but not limited to (i) the Company’s legal and accounting fees and disbursements, (ii) the preparation, printing,
filing, mailing and delivery (including the payment of postage with respect to such mailing) of the Registration Statement, the
Preliminary Sale Prospectus and the Prospectus, including any pre or post effective amendments or supplements thereto, and the
printing and mailing of this Agreement and related documents, including the cost of all copies thereof and any amendments thereof
or supplements thereto supplied to the Underwriters in quantities as may be required by the Underwriters, (iii) fees incurred in
connection with conducting background checks of the Company’s management team, up to $3,000 per individual, (iv) the preparation,
printing, engraving, issuance and delivery of the Units, the Common Stock and the Warrants included in the Units, including any
transfer or other taxes payable thereon, (v) filing fees and expenses (including legal fees of the Representative not to exceed
$15,000) incurred in registering the Offering with FINRA, (vi) fees, costs and expenses incurred in listing the Securities on the
NASDAQ Capital Market or such other stock exchanges as the Company and the Representative together determine, (vii) all fees and
disbursements of the transfer and warrant agent, (viii) all Company’s expenses associated with “due diligence”
and “road show” meetings arranged by the Representative and any presentations made available by way of a netroadshow,
including, without limitation, trips for the Company’s management to meet with prospective investors, all travel, food and
lodging expenses associated with such trips incurred by the Company or such management; (ix) the preparation, binding and delivery
of bound transaction “bibles,” in quantities and form and style reasonably satisfactory to the Representative and Lucite
cube mementos in such quantities as Representative may reasonably request; and (x) all other costs and expenses customarily borne
by an issuer incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this
Section 3.12. In the event that this Agreement shall not be carried out for any reason whatsoever, within the time specified herein
or any extensions thereof pursuant to the terms herein, the provisions of Section 9.3 hereof shall apply. 3.13 Application
of Net Proceeds. The Company will apply the net proceeds from the Offering and Unit Private Placement received by it in a manner
consistent with the application described under the caption “Use of Proceeds” in the Prospectus. 3.14 Delivery
of Earnings Statements to Security Holders. The Company will make generally available to its security holders as soon as practicable,
but not later than the first day of the fifteenth full calendar month following the Effective Date, an earnings statement (which
need not be certified by independent public or independent certified public accountants unless required by the Act or the Regulations,
but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Act) covering a period of at least twelve consecutive
months beginning after the Effective Date. 3.15 Notice
to FINRA. 3.15.1 Notice
to FINRA. For a period of 90 days after the Effective Date, in the event any person or entity (regardless of any FINRA affiliation
or association) is engaged, in writing, to assist the Company in its search for a Target Business (as defined below) or to provide
any other services in connection therewith, the Company will provide the following to FINRA and the Representative prior to the
consummation of the Business Combination: (i) complete details of all services and copies of agreements governing such services;
and (ii) justification as to why the person or entity providing the merger and acquisition services should not be considered an
“underwriter and related person” with respect to the Offering, as such term is defined in Rule 5110 of the FINRA Manual.
The Company also agrees that, if required by law, proper disclosure of such arrangement or potential arrangement will be made in
the tender offer documents or proxy statement which the Company will file with the Commission in connection with the Business Combination. 3.15.2 FINRA.
The Company shall advise the Representative (who shall make an appropriate filing with FINRA) if it is aware that any 5% or greater
stockholder of the Company becomes an affiliate or associated person of a FINRA member participating in the distribution of the
Public Securities. 3.15.3 Broker/Dealer.
In the event the Company intends to register as a broker/dealer, merge with or acquire a registered broker/dealer, or otherwise
become a member of FINRA, it shall promptly notify FINRA. 3.16 Stabilization.
Neither the Company, nor to its knowledge any of its employees, directors or stockholders (without the consent of the Representative)
has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected
to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Units. 3.17 Existing
Lock-Up Agreement. The Company will enforce all existing agreements between the Company and any of its security holders that prohibit
the sale, transfer, assignment, pledge or hypothecation of any of the Securities in connection with the Offering. In addition,
the Company will direct the Transfer Agent to place stop transfer restrictions upon any such securities of the Company that are
bound by such existing “lock-up” agreements for the duration of the periods contemplated in such agreements. 3.18 Payment
of Deferred Underwriting Commission on Business Combination. Upon the consummation of a Business Combination, the Company agrees
that it will cause the Trustee to pay the Deferred Underwriting Commission directly from the Trust Account to the Representative,
in accordance with Section 1.3. 3.19 Internal
Controls. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that:
(i) transactions are executed in accordance with management’s general or specific authorization, (ii) transactions are recorded
as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv)
the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken
with respect to any differences. 3.20 Accountants.
Until the earlier of five years from the Effective Date or until such earlier time upon which the Company is required to be liquidated,
the Company shall retain Marcum or another independent registered public accounting firm reasonably acceptable to the Representative. 3.21 Form
8-K. The Company has retained its independent registered public accounting firm to audit the balance sheet of the Company as of
the Closing Date (the “Audited Balance Sheet”) reflecting the receipt by the Company of the proceeds of the
Offering and the Unit Private Placement. Within four (4) Business Days after the Closing Date, the Company shall file a Current
Report on Form 8-K with the Commission, which Report shall contain the Company’s Audited Balance Sheet. Promptly after the
Option Closing Date, if the Over-allotment Option is exercised after the Closing Date, the Company shall file with the Commission
a Current Report on Form 8-K or an amendment to the Form 8-K, to provide updated financial information to reflect the exercise
of such option. 3.22 Corporate
Proceedings. All corporate proceedings and other legal matters necessary to carry out the provisions of this Agreement and the
transactions contemplated hereby shall have been done to the reasonable satisfaction to EGS. 3.23 Investment
Company. The Company shall cause the proceeds of the Offering to be held in the Trust Account to be invested only in U.S. government
treasury bills with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated
under the Investment Company Act as set forth in the Trust Agreement and disclosed in the Prospectus. The Company will otherwise
conduct its business in a manner so that it will not become subject to the Investment Company Act. Furthermore, once the Company
consummates a Business Combination, it shall be engaged in a business other than that of investing, reinvesting, owning, holding
or trading securities. 3.24 Amendments
to Amended and Restated Certificate of Incorporation and Bylaws. 3.24.1 The
Company covenants and agrees, that prior to its initial Business Combination it will not seek to amend or modify its Amended
and Restated Certificate of Incorporation and Bylaws, as amended, including, but not limited to Article 6 of its Amended and
Restated Certificate of Incorporation, except as set forth in the Amended and Restated Certificate of Incorporation and
Bylaws. 3.24.2 The
Company acknowledges that the purchasers of the Public Securities in the Offering shall be deemed to be third party beneficiaries
of this Agreement and specifically this Section 3.24. 3.25 Press
Releases. The Company agrees that it will not issue press releases or engage in any other publicity, without the Representative’s
prior written consent (not to be unreasonably withheld), for a period of twenty-five (25) days after the Closing Date. Notwithstanding,
in no event shall the Company be prohibited from issuing any press releases or engaging in any other publicity required by law. 3.26 Insurance.
The Company will maintain directors’ and officers’ insurance (including insurance covering the Company, its directors
and officers for liabilities or losses arising in connection with this Offering, including, without limitation, liabilities or
losses arising under the Act, the Exchange Act, the Regulations and any applicable foreign securities laws). 3.27 Electronic
Prospectus. The Company shall cause to be prepared and delivered to the Representative, at the Company’s expense, promptly,
but in no event later than two (2) Business Days from the effective date of this Agreement, an Electronic Prospectus to be used
by the Underwriters in connection with the Offering. As used herein, the term “Electronic Prospectus”
means a form of prospectus, and any amendment or supplement thereto, that meets each of the following conditions: (i) it shall
be encoded in an electronic format, satisfactory to the Representative, that may be transmitted electronically by the other Underwriters
to offerees and purchasers of the Units for at least the period during which a prospectus relating to the Units is required to
be delivered under the Act; (ii) it shall disclose the same information as the paper prospectus and prospectus filed pursuant to
EDGAR, except to the extent that graphic and image material cannot be disseminated electronically, in which case such graphic and
image material shall be replaced in the electronic prospectus with a fair and accurate narrative description or tabular representation
of such material, as appropriate; and (iii) it shall be in or convertible into a paper format or an electronic format, satisfactory
to the Representative, that will allow recipients thereof to store and have continuously ready access to the prospectus at any
future time, without charge to such recipients (other than any fee charged for subscription to the Internet as a whole and for
on-line time). 3.28 Future
Financings. The Company agrees that neither it, nor any successor or subsidiary of the Company, will consummate any public or private
equity or debt financing prior to or in connection with the consummation of a Business Combination, unless all investors in such
financing expressly waive, in writing, any rights in or claims against the Trust Account. 3.29 Unit
Private Placement Proceeds. On or prior to the Effective Date, the Company shall have deposited $5,750,000 of the proceeds from
the Unit Private Placement in the Trust Account or to a separate escrow account maintained by Graubard who will transfer such amount
to the Trust Account on the Closing Date and shall provide the Representative with evidence of the same. The Unit Private Placement
shall be consummated on the Closing Date. 3.30 Amendments
to Agreements. The Company shall not amend, modify or otherwise change the Warrant Agreement, Administrative Services Agreement,
Escrow Agreement, Trust Agreement, Registration Rights Agreement, Subscription Agreements or any Insider Letter without the prior
written consent of the Representative. 3.31 NASDAQ.
Until the consummation of a Business Combination, the Company will use its best efforts to maintain the listing of the Public Securities
on the NASDAQ Capital Market or a national securities exchange acceptable to the Representative. 3.32 Reservation
of Shares. The Company will reserve and keep available that maximum number of its authorized but unissued securities which are
issuable upon exercise of the Warrants and Placement Warrants outstanding from time to time. 4. Conditions
of Underwriters’ Obligations. The obligations of the Representative to purchase and pay for the Units, as provided herein,
shall be subject to the continuing accuracy of the representations and warranties of the Company as of the date hereof and as of
each of the Closing Date and the Option Closing Date, if any, to the accuracy of the statements of officers of the Company made
pursuant to the provisions hereof and to the performance by the Company of its obligations hereunder and to the following conditions: 4.1 Regulatory
Matters. 4.1.1 Effectiveness
of Registration Statement. The Registration Statement shall have become effective not later than 4:00 p.m., New York time,
on the date of this Agreement or such later date and time as shall be consented to in writing by the Representative, and, at each
of the Closing Date and the Option Closing Date, no stop order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for the purpose shall have been instituted or shall be pending or contemplated by the Commission
and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction
of EGS. 4.1.2 FINRA
Clearance. By the Effective Date, the Representative shall have received clearance from FINRA as to the amount of compensation
allowable or payable to the Underwriters as described in the Registration Statement. 4.1.3 No
Blue Sky Stop Orders. No order suspending the sale of the Units in any jurisdiction designated by the Underwriters pursuant
to Section 3.5 hereof shall have been issued on either of the Closing Date or the Option Closing Date, and no proceedings for that
purpose shall have been instituted or, to the Company’s knowledge, shall be contemplated. 4.1.4 No
Commission Stop Order. At the Closing Date, the Commission has not issued any order or threatened to issue any order preventing
or suspending the use of any Preliminary Prospectus, the Prospectus or any part thereof, and has not instituted or, to the Company’s
knowledge, threatened to institute any proceedings with respect to such an order. 4.1.5 NASDAQ.
The Securities shall have been approved for listing on the NASDAQ Capital Market, subject to official notice of issuance and evidence
of satisfactory distribution, satisfactory evidence of which shall have been provided to the Representative. 4.2 Company
Counsel Matters. 4.2.1 Closing
Date and Option Closing Date Opinions of Counsel. On the Closing Date and the Option Closing Date, if any, the Representative
shall have received the favorable opinion and negative assurance statement of Graubard,
dated the Closing Date or the Option Closing Date, as the case may be, addressed to the Representative as representative for the
several Underwriters and in form and substance satisfactory to the Representative and EGS. 4.2.2 Reliance.
In rendering such opinion, such counsel may rely as to matters of fact, to the extent they deem proper, on certificates or other
written statements of officers of the Company and officers of departments of various jurisdictions having custody of documents
respecting the corporate existence or good standing of the Company, provided that copies of any such statements or certificates
shall be delivered to the Underwriters’ counsel if requested. The opinions of counsel for the Company shall include a statement
to the effect that it may be relied upon by counsel for the Underwriters in its opinion delivered to the Underwriters. 4.3 Comfort
Letter. At the time this Agreement is executed, and at each of the Closing Date and the Option Closing Date, if any, the Underwriters
shall have received a letter, addressed to the Representative as representative for the several Underwriters and in form and substance
satisfactory in all respects (including the non-material nature of the changes or decreases, if any, referred to in clause (iii)
below) to the Representative and to EGS from Marcum dated, respectively, as of the date of this Agreement and as of the Closing
Date and the Option Closing Date, if any: (i) Confirming
that they are independent accountants with respect to the Company within the meaning of the Act and the applicable Regulations
and that they have not, during the periods covered by the financial statements included in the Registration Statement, Preliminary
Prospectus, Sale Preliminary Prospectus and the Prospectus, provided to the Company any non-audit services, as such term is used
in Section 10A(g) of the Exchange Act; (ii) Stating
that in their opinion the financial statements of the Company included in the Registration Statement, the Sale Preliminary Prospectus
and the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act and the published
Regulations thereunder; (iii)
Stating that, on the basis of their review, which included a reading of the latest available unaudited interim financial
statements of the Company (with an indication of the date of the latest available unaudited interim financial statements), a reading
of the latest available minutes of the stockholders and Board of Directors and the various committees of the Board of Directors,
consultations with officers and other employees of the Company responsible for financial and accounting matters and other specified
procedures and inquiries, nothing has come to their attention that would lead them to believe that: (a) the unaudited financial
statements of the Company included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus do not comply
as to form in all material respects with the applicable accounting requirements of the Act and the Regulations or are not fairly
presented in conformity with GAAP applied on a basis substantially consistent with that of the audited financial statements of
the Company included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, or (b) at a date not later
than five days prior to the Effective Date, Closing Date or Option Closing Date, as the case may be, there was any change in the
capital stock or long-term debt of the Company, or any decrease in the stockholders’ equity of the Company as compared with
amounts shown in the September 30, 2014 balance sheet included in the Registration Statement, the Sale Preliminary Prospectus and
the Prospectus, other than as set forth in or contemplated by the Registration Statement, the Sale Preliminary Prospectus and
the Prospectus or, if there was any decrease, setting forth the amount of such decrease, and (c) during the period from September 30,
2014 to a specified date not later than five days prior to the Effective Date, Closing Date or Option Closing Date, as the case
may be, there was any decrease in revenues, net earnings or net earnings per share of Common Stock, in each case as compared with
the corresponding period in the preceding year and as compared with the corresponding period in the preceding quarter, other than
as set forth in or contemplated by the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, or, if there
was any such decrease, setting forth the amount of such decrease; (iv)
Setting forth, at a date not later than five days prior to the Effective Date, the amount of liabilities of the Company
(including a break-down of commercial papers and notes payable to banks); (v) Stating
that they have compared specific dollar amounts, numbers of shares, percentages of revenues and earnings, statements and other
financial information pertaining to the Company set forth in the Registration Statement, the Sale Preliminary Prospectus and the
Prospectus in each case to the extent that such amounts, numbers, percentages, statements and information may be derived from the
general accounting records, including work sheets, of the Company and excluding any questions requiring an interpretation by legal
counsel, with the results obtained from the application of specified readings, inquiries and other appropriate procedures (which
procedures do not constitute an examination in accordance with generally accepted auditing standards) set forth in the letter and
found them to be in agreement; (vi) Stating
that they have not, since the Company’s incorporation, brought to the attention of the Company’s management any reportable
condition related to internal structure, design or operation as defined in the Statement on Auditing Standards No. 60 “Communication
of Internal Control Structure Related Matters Noted in an Audit,” in the Company’s internal controls; and (vii) Statements
as to such other matters incident to the transaction contemplated hereby as the Representative or EGS may reasonably request,
including: 4.4 Officers’
Certificates. 4.4.1 Officers’
Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate
of the Company signed by the Chairman of the Board or the Chief Executive Officer and the Secretary or Assistant Secretary of the
Company (in their capacities as such), dated the Closing Date or the Option Closing Date, as the case may be, respectively, to
the effect that the Company has performed all covenants and complied with all conditions required by this Agreement to be performed
or complied with by the Company prior to and as of the Closing Date, or the Option Closing Date, as the case may be, and that the
conditions set forth in Section 4.4 hereof have been satisfied as of such date and that, as of Closing Date and the Option Closing
Date, as the case may be, the representations and warranties of the Company set forth in Section 2 hereof are true and correct.
In addition, the Representative will have received such other and further certificates of officers of the Company (in their capacities
as such) as the Representative may reasonably request. 4.4.2 Secretary’s
Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate
of the Company signed by the Secretary or Assistant Secretary of the Company, dated the Closing Date or the Option Date, as the
case may be, respectively, certifying (i) that the Amended and Restated Certificate of Incorporation and Bylaws of the Company,
as amended, are true and complete, have not been modified and are in full force and effect, (ii) that the resolutions of the Company’s
Board of Directors relating to the public offering contemplated by this Agreement are in full force and effect and have not been
modified, (iii) as to the accuracy and completeness of all correspondence between the Company or its counsel and the Commission,
and (iv) as to the incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to
such certificate. 4.5 No
Material Changes. Prior to and on each of the Closing Date and the Option Closing Date, if any, (i) there shall have been no material
adverse change or development involving a prospective material adverse change in the condition or prospects or the business activities,
financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement
and the Prospectus, (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against the
Company or any Insider before or by any court or federal, foreign or state commission, board or other administrative agency wherein
an unfavorable decision, ruling or finding may materially adversely affect the business, operations, or financial condition or
income of the Company, except as set forth in the Registration Statement and the Prospectus, (iii) no stop order shall have been
issued under the Act and no proceedings therefor shall have been initiated or, to the Company’s knowledge, threatened by
the Commission, and (iv) the Registration Statement, the Sale Preliminary Prospectus and the Prospectus and any amendments or
supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Act and
the Regulations and shall conform in all material respects to the requirements of the Act and the Regulations, and neither the
Registration Statement, the Sale Preliminary Prospectus nor the Prospectus nor any amendment or supplement thereto shall contain
any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading. 4.6 Delivery
of Agreements. On the Effective Date, the Company shall have delivered to the Representative executed copies of the Trust Agreement,
the Subscription Agreements, the Administrative Services Agreement, the Escrow Agreement, the Registration Rights Agreements, the
Warrant Agreement and all of the Insider Letters. 5. Indemnification. 5.1 Indemnification
of the Underwriters. 5.1.1 General.
Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless each of the Underwriters and their
affiliates, and each dealer selected by the Underwriters that participates in the offer and sale of the Securities (each a
“Selected Dealer”) and each of their respective directors, officers and employees and each person, if any,
who controls within the meaning of Section 15 of the Act or Section 20(a) of the Exchange Act (“Controlling Person”)
any such Underwriter, against any and all loss, liability, claim, damage and expense whatsoever as incurred to which they or any
of them may become subject under the Act, the Exchange Act or any other statute or at common law or otherwise or under the laws
of foreign countries, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained
in (i) the Registration Statement, any Preliminary Prospectus including the Sale Preliminary Prospectus or the Prospectus (as
from time to time each may be amended and supplemented, including, but not limited to any information deemed to be a part thereof
pursuant to Rule 430A, Rule 430B or Rule 430C); (ii) any materials or information provided to investors by, or with the approval
of, the Company in connection with the marketing of the offering of the Securities, including any “road show”
or investor presentations made to investors by the Company (whether in person or electronically); (iii) any application or other
document or written communication (in this Section 5, collectively called “application”) executed by
the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Public Securities
under the securities laws thereof or filed with the Commission, any foreign or state securities commission or agency, the NYSE,
the NYSE MKT, the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market or the OTCBB or (iv) any post-effective
amendments to the Registration Statement or Prospectus or new Registration Statement or Prospectus filed by the Company with the
Commission, any state securities commission or agency, OTCBB or any securities exchange, or the omission or alleged omission from
the Registration Statement, any Preliminary Prospectus including the Sale Preliminary Prospectus or the Prospectus or subsequent
filing by the Company under clause (iv) of a material fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading, and to reimburse each Underwriter, each Selected
Dealer and each of their respective directors, officers and employees and each Controlling Person, if any, for any and all expenses
(including the fees and disbursements or counsel chosen by the Representative) as such expenses are incurred by such Underwriter,
such Selected Dealer or each of their respective directors, officers, partners and employees or such Controlling Person in connection
with investigating, defending, settling, compromising or paying any such loss, claim damage, liability, expense or action; provided
however, that the foregoing indemnity agreement shall not apply to any loss, claim, damage, liability or expenses to the extent,
but only to the extent, arising out of or based upon (x) any untrue statement or alleged untrue statement or omission or alleged
omission made in reliance upon and in conformity with written information furnished to the Company with respect to an Underwriter
by or on behalf of such Underwriter expressly for use in the Registration Statement, any Preliminary Prospectus including the
Sale Preliminary Prospectus or the Prospectus, or any amendment or supplement thereof, or in any application, as the case may
be, or the jurisdictions listed in the section entitled “Notices to Non-U.S. Investors” in the Registration Statement,
any Preliminary Prospectus including the Sale Preliminary Prospectus or the Prospectus, or any amendment or supplement thereof,
as the case may be; (y) the use of the Sale Preliminary Prospectus or Prospectus in violation of any stop order or other notice
received by any Underwriter indicating the then current Prospectus is not to be used in connection with the sale of any Securities
or (z) an Underwriter otherwise failing in its prospectus delivery obligations. The Company agrees promptly to notify the Representative
of the commencement of any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons
in connection with the issue and sale of the Securities or in connection with the Registration Statement, the Sale Preliminary
Prospectus or the Prospectus. The indemnity agreement set forth in this Section 5.1 shall be in addition to any liabilities that
the Company may otherwise have. 5.2 Indemnification
of the Company. Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company, its directors,
its officers who signed the Registration Statement and each Controlling Person of the Company, if any, against any and all loss,
liability, claim, damage and expense described in the foregoing indemnity from the Company to the several Underwriters, as incurred,
but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in the Registration Statement,
any Preliminary Prospectus including the Sale Preliminary Prospectus, the Prospectus or any amendment or supplement thereto or
in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect
to such Underwriter by or on behalf of the Underwriter expressly for use in the Registration Statement, any Preliminary Prospectus
including the Sale Preliminary Prospectus, the Prospectus or any amendment or supplement thereto, or in any such application,
and to reimburse the Company or any such director, officer or Controlling Person, if any, for any and all expenses as such expenses
are reasonably incurred, in connection with investigating, defending, settling, compromising or paying any such loss, claim damage,
liability, expense or action; provided, however, that the obligation of each Underwriter to indemnify the Company (including any
director, officer or Controlling Person thereof), shall be limited to the commissions received by such Underwriter in connection
with the Securities underwritten by it. The Company hereby acknowledges that the only information that the Underwriters have furnished
to the Company expressly for use in the Registration Statement, the Preliminary Prospectus including the Sale Preliminary Prospectus,
the Prospectus or any amendment or supplement thereto, shall consist solely of the Underwriters’ Information. The indemnity
agreement set forth in this Section 5.2 shall be in addition to any liabilities that each Underwriter may otherwise have. 5.3 Notifications
and Other Indemnification Procedures. Promptly after receipt by an indemnified party under this Section 5 of notice of the commencement
of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party under this
Section 5, notify the indemnifying party in writing of the commencement thereof, but the failure to so notify the indemnifying
party (i) will not relieve it from liability under paragraph 5.1 or 5.2 above unless and to the extent it did not otherwise learn
of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii)
will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification
obligation provided in paragraph 5.1 or 5.2 above. In case any such action is brought against any indemnified party and such indemnified
party seeks or intends to seek indemnity from an indemnifying party, the indemnifying party will be entitled to participate in,
and, to the extent that it shall elect, jointly with all other indemnifying parties similarly notified, by written notice delivered
to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof
with counsel satisfactory to such indemnified party; provided, however, if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably concluded that a conflict may arise between the
positions of the indemnifying party and the indemnified party in conducting the defense of any such action or that there may be
legal defenses available to it and/or other indemnified parties that are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to select separate counsel to assume such legal defenses
and to otherwise participate in the defense of such action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of such indemnifying party’s election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under
this Section 5 for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof
unless (i) the indemnified party shall have employed separate counsel in accordance with the provision to the preceding sentence
reasonably approved by the indemnifying party (or by the Representative in the case of Section 5.2), representing the indemnified
parties who are parties to such action) or (ii) the indemnifying party shall not have employed counsel satisfactory to the indemnified
party to represent the indemnified party within a reasonable time after notice of commencement of the action, in each of which
cases the fees and expenses of counsel shall be at the expense of the indemnifying party. 5.4 Settlements.
The indemnifying party under this Section 5 shall not be liable for any settlement of any proceeding effected without its written
consent, which shall not be withheld, delayed or conditioned unreasonably, but if settled with such consent or if there is a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party against any loss, claim, damage,
liability or expense by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated
by Section 5.3 hereof, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid
request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior
to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect
any settlement, compromise or consent to the entry of judgment in any pending or threatened action, suit or proceeding in respect
of which any indemnified party is or could have been a party and indemnity was or could have been sought hereunder by such indemnified
party, unless such settlement, compromise or consent (x) includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such action, suit or proceeding and (y) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party. 5.5 Contribution. 5.5.1 Contribution
Rights. In order to provide for just and equitable contribution under the Act in any case in which (i) any person entitled
to indemnification under this Section 5 makes claim for indemnification pursuant hereto but it is judicially determined (by the
entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section
5 provides for indemnification in such case, or (ii) contribution under the Act, the Exchange Act or otherwise may be required
on the part of any such person in circumstances for which indemnification is provided under this Section 5, then, and in each such
case, the Company and the Underwriters shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the
nature contemplated by said indemnity agreement incurred by the Company and the Underwriters, as incurred, in such proportions
that the Underwriters are responsible for that portion represented by the percentage that the underwriting discount appearing on
the cover page of the Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the balance;
provided, that, no person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent misrepresentation. If the allocation provided by the immediately
preceding sentence is unavailable for any reason, the Company and the Underwriters shall contribute in such proportion as is appropriate
to reflect the relative fault of the Company and the Underwriters in connection with the actions or omissions which resulted in
such loss, claim, damage, liability or action, as well as any other relevant equitable considerations. The relative fault of the
Company and the Underwriters shall be determined by reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact relates to information furnished by the Company
or the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. Notwithstanding the provisions of this Section 5.5.1, no Underwriter shall be required to contribute
any amount in excess of the underwriting commissions received by such Underwriter in connection with the Securities underwritten
by it and distributed to the public. For purposes of this Section, each director, officer and employee of an Underwriter or the
Company, as applicable, and each person, if any, who controls an Underwriter or the Company, as applicable, within the meaning
of Section 15 of the Act shall have the same rights to contribution as the Underwriters or the Company, as applicable. 5.5.2 Contribution
Procedure. Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement
of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another
party (“Contributing Party”), notify the Contributing Party of the commencement thereof, but the omission to
so notify the Contributing Party will not relieve it from any liability which it may have to any other party other than for contribution
hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a Contributing Party
or its representative of the commencement thereof within the aforesaid fifteen days, the Contributing Party will be entitled to
participate therein with the notifying party and any other Contributing Party similarly notified. Any such Contributing Party
shall not be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding effected
by such party seeking contribution on account of any settlement of any claim, action or proceeding effected by such party seeking
contribution without the written consent of such Contributing Party. The contribution provisions contained in this Section are
intended to supersede, to the extent permitted by law, any right to contribution under the Act, the Exchange Act or otherwise
available. The Underwriters’ obligations to contribute pursuant to this Section 5.5 are several and not joint. 6. Default
by an Underwriter. 6.1 Default
Not Exceeding 10% of Firm Units or Option Units. If any Underwriter or Underwriters shall default in its or their obligations to
purchase the Firm Units or the Option Units, if the Over-Allotment Option is exercised, and if the number of the Firm Units or
Option Units with respect to which such default relates does not exceed in the aggregate 10% of the number of Firm Units or Option
Units that all Underwriters have agreed to purchase hereunder, then such Firm Units or Option Units to which the default relates
shall be purchased by the non-defaulting Underwriters in proportion to their respective commitments hereunder. 6.2 Default
Exceeding 10% of Firm Units or Option Units. In the event that the default addressed in Section 6.1 above relates to more than
10% of the Firm Units or Option Units, the Representative may, in its discretion, arrange for the Representative or for another
party or parties to purchase such Firm Units or Option Units to which such default relates on the terms contained herein. If within
one (1) Business Day after such default relating to more than 10% of the Firm Units the Representative or Option Units the Underwriters
do not arrange for the purchase of such Firm Units or Option Units, then the Company shall be entitled to a further period of one
(1) Business Day within which to procure another party or parties satisfactory to the Representative to purchase said Firm Units
or Option Units on such terms. In the event that neither the Representative nor the Company arrange for the purchase of the Firm
Units or Option Units to which a default relates as provided in this Section 6, this Agreement will be terminated by the Representative
or the Company without liability on the part of the Company (except as provided in Sections 3.11 and 5 hereof) or the several Underwriters
(except as provided in Section 5 hereof); provided, however, that if such default occurs with respect to the Option Units, this
Agreement will not terminate as to the Firm Units; and provided further that nothing herein shall relieve a defaulting Underwriter
of its liability, if any, to the other several Underwriters and to the Company for damages occasioned by its default hereunder. 6.3 Postponement
of Closing Date. In the event that the Firm Units or Option Units to which the default relates are to be purchased by the non-defaulting
Underwriters, or are to be purchased by another party or parties as aforesaid, the Representative or the Company shall have the
right to postpone the Closing Date or Option Closing Date for a reasonable period, but not in any event exceeding five (5) Business
Days, in order to effect whatever changes may thereby be made necessary in the Registration Statement, the Sale Preliminary Prospectus
or the Prospectus, as the case may be, or in any other documents and arrangements, and the Company agrees to file promptly any
amendment to, or to supplement, the Registration Statement or the Prospectus, as the case may be, that in the opinion of counsel
for the Underwriters may thereby be made necessary. The term “Underwriter” as used in this Agreement
shall include any party substituted under this Section 6 with like effect as if it had originally been a party to this Agreement
with respect to such Public Securities. 7. Additional
Covenants. 7.1 Additional
Shares or Options. The Company hereby agrees that until the consummation of a Business Combination, it shall not issue any shares
of Common Stock or any options or other securities convertible into Common Stock, or any shares of preferred stock or other securities
of the Company which participate in any manner in the Trust Account or which vote as a class with the Common Stock on a proposed
Business Combination. 7.2 Trust
Account Waiver Acknowledgments. The Company hereby agrees that it will use its reasonable best efforts prior to commencing its
due diligence investigation of any prospective Target Business or prior to obtaining the services of any vendor, to acknowledge
in writing whether through a letter of intent, memorandum of understanding or other similar document (and subsequently acknowledges
the same in any definitive document replacing any of the foregoing), that (a) it has read the Prospectus, and understands that
the Company has established the Trust Account, initially in an amount of $102,000,000 (without giving effect to any exercise of
the Over-allotment Option) for the benefit of the Public Stockholders and that, except for a portion of the interest earned on
the amounts held in the Trust Account, the Company may disburse monies from the Trust Account only: (i) to the Public Stockholders
in the event they elect to redeem their IPO Shares (as defined below) in connection with the consummation of a Business Combination,
(ii) to the Public Stockholders if the Company fails to consummate a Business Combination within 24 months from the Closing Date,
or (iii) to the Company after or concurrently with the consummation of a Business Combination and (b) for and in consideration
of the Company (i) agreeing to evaluate such Target Business for purposes of consummating a Business Combination with it or (ii)
agreeing to engage the services of the vendor, as the case may be, such Target Business or vendor agrees that it does not have
any right, title, interest or claim of any kind in or to any monies in the Trust Account (“Claim”) and waives
any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with the Company
and will not seek recourse against the Trust Account for any reason whatsoever. The foregoing letters shall substantially be in
the form attached hereto as Exhibits A and B respectively. The Company may forego obtaining such waivers only if the Company shall
have received the approval of its Chief Executive Officer and the approving vote or written consent of at least a majority of its
Board of Directors. The term “IPO Shares” means the Common Stock contained in the Public Securities. 7.3 Insider
Letters. 7.3.1 The
Company shall not take any action or omit to take any action that would cause a breach of any of the Insider Letters and will not
allow any amendments to, or waivers of, such Insider Letters without the prior written consent of the Representative. 7.3.2 The
Company shall cause each of the Insiders to agree in an Insider Letter that, (i) in order to minimize potential conflicts of interest
which may arise from multiple affiliations, the Insiders will present to the Company for its consideration, prior to presentation
to any other person or company, any suitable opportunity to acquire an operating business, until the earlier of the consummation
by the Company of a Business Combination, the liquidation of the Company or until such time as the Insiders cease to be an officer
or director of the Company, subject to any pre-existing fiduciary or contractual obligations the Insiders might have and (ii) the
Insiders agree to certain matters, including but not limited to, the voting of Common Stock held by them and certain matters described
as being agreed to by them under the “Proposed Business” section of the Registration Statement, the Sale Preliminary
Prospectus and Prospectus. 7.4 Amended
and Restated Certificate of Incorporation and Bylaws. The Company shall not take any action or omit to take any action that would
cause the Company to be in breach or violation of its Amended and Restated Certificate of Incorporation and Bylaws, as amended. 7.5 Acquisition/Liquidation
Procedure. The Company agrees that it will comply with its Amended and Restated Certificate of Incorporation and Bylaws, as amended,
in connection with the consummation of a Business Combination or the failure to consummate a Business Combination within 24 months
from the Closing Date. The Company agrees that it will not propose any amendment to such Amended and Restated Certificate of Incorporation
and Bylaws, as amended, that would affect the substance or timing of the Company’s obligations as described in Article 6
of the Amended and Restated Certificate of Incorporation and Bylaws, as amended, with respect to the redemption rights of Public
Stockholders. 7.6 Rule
419. The Company agrees that it will use its best efforts to prevent the Company from becoming subject to Rule 419 under the Act
prior to the consummation of any Business Combination, including, but not limited to, using its best efforts to prevent any of
the Company’s outstanding securities from being deemed to be a “penny stock” as defined in Rule 3a-51-1
under the Exchange Act during such period. 7.7 Tender
Offer Documents, Proxy Materials and Other Information. The Company shall provide to the Representative or its counsel (if so
instructed by the Representative) with 10 copies of all tender offer documents or proxy information and all related material filed
with the commission in connection with a Business Combination concurrently with such filing with the commission. Documents filed
with the Commission pursuant to its EDGAR system shall be deemed to have been provided to the Representative pursuant to this
Section. In addition, the Company shall furnish any other state in which its initial public offering was registered, such information
as may be requested by such state. 7.8 The
Company shall promptly notify the Representative if the Company ceases to be an Emerging Growth Company at any time prior to the
later of (a) completion of the distribution of the Securities within the meaning of the Act and (b) completion of the 180 day restricted
period. 7.9 Target
Net Assets. The Company agrees that the Target Business that it acquires must have a fair market value equal to at least 80% of
the balance in the Trust Account at the time of signing the definitive agreement for the Business Combination with such Target
Business. The fair market value of such business must be determined by the Board of Directors of the Company based upon standards
generally accepted by the financial community, such as actual and potential sales, earnings, cash flow and book value. If the Board
of Directors of the Company is not able to independently determine that the target business meets such fair market value requirement,
the Company will obtain an opinion from an unaffiliated, independent investment banking firm reasonably acceptable to the Representative
with respect to the satisfaction of such criteria. The Company is not required to obtain an opinion from an investment banking
firm as to the fair market value if the Company’s Board of Directors independently determines that the Target Business does
have sufficient fair market value, provided that the Target Business is not affiliated with an Insider. The purchase price of the
Target Business may be funded through any mix of cash, stock or debt financing. 7.10 Increase in Offering Size. The Company and
the Representative agree that they will not increase the size of the Offering pursuant to Rule 462(b) of the Act unless (i) the
Insiders agree in writing to purchase additional Placement Units from the Company in such amounts that would maintain the per-share
redemption price of the IPO shares at no lower than $10.00, or (ii) the Representative defers a larger portion of the underwriting
discount such that the per-share redemption price of the IPO Shares would be no less than $10.00. 8. Representations
and Agreements to Survive Delivery. Except as the context otherwise requires, all representations, warranties and agreements
contained in this Agreement shall be deemed to be representations, warranties and agreements as of the Closing Date or the Option
Closing Date, if any, and such representations, warranties and agreements of the Underwriters and the Company, including the indemnity
agreements contained in Section 5 hereof, shall remain operative and in full force and effect regardless of any investigation made
by or on behalf of any Underwriter, the Company or any Controlling Person, and shall survive termination of this Agreement or the
issuance and delivery of the Public Securities to the several Underwriters until the earlier of the expiration of any applicable
statute of limitations and the seventh (7th) anniversary of the later of the Closing Date or the Option Closing Date, if any, at
which time the representations, warranties and agreements shall terminate and be of no further force and effect. 9. Effective
Date of This Agreement and Termination Thereof. 9.1 Effective
Date. This Agreement shall become effective on the Effective Date at the time the Registration Statement is declared effective
by the Commission. 9.2 Termination.
The Representative shall have the right to terminate this Agreement at any time prior to the Closing Date: (i) if any domestic
or international event or act or occurrence has materially disrupted, or in the Representative’s opinion will in the immediate
future materially disrupt, general securities markets in the United States; or (ii) if trading on the NYSE, the NYSE MKT, the
NASDAQ Global Select Market, the NASDAQ Global Market, or the NASDAQ Capital Market shall have been suspended, or minimum or maximum
prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been fixed, or maximum ranges
for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having
jurisdiction; or (iii) if the United States shall have become involved in a new war or an increase in existing major hostilities,
or (iv) if a banking moratorium has been declared by a New York State or Federal authority, or (v) if a moratorium on foreign
exchange trading has been declared which materially adversely impacts the United States securities market, or (vi) if the Company
shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious
act which, whether or not such loss shall have been insured, will, in the Representative’s sole opinion, make it inadvisable
to proceed with the delivery of the Units; or (vii) if the Company is in material breach of any of its representations, warranties
or covenants hereunder, or (viii) if the Representative shall have become aware after the date hereof of such a material adverse
change in the conditions of the Company, or such adverse material change in general market conditions, including, without limitation,
as a result of terrorist activities after the date hereof, as in the Representative’s sole judgment would make it impracticable
to proceed with the offering, sale and/or delivery of the Units or to enforce contracts made by the Underwriters for the sale
of the Public Securities. 9.3 Expenses.
In the event that this Agreement shall not be carried out for any reason whatsoever, within the time specified herein or any extensions
thereof pursuant to the terms herein, the Company shall (i) reimburse the Representative for the full amount of its actual accountable
out of pocket expenses incurred to such date (which shall include, but shall not be limited to, all reasonable fees and disbursements
of the Representative’s counsel, mailing, printing and reproduction expense and any expenses incurred by the Representative
in conducting its due diligence) less amounts previously paid pursuant to Section 3.11, and (ii) reimburse the Representative for
the full amount of background checks of the Company’s officers and directors, travel, lodging and road show expenses incurred
to such date, less the amounts previously paid to the Representative as an advance and in reimbursement for such expenses. 9.4 Indemnification.
Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement,
and whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall not be in any way affected by such
election or termination or failure to carry out the terms of this Agreement or any part hereof. 10. Miscellaneous. 10.1 Notices.
All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed, delivered
by hand or reputable overnight courier or delivered by facsimile transmission (with printed confirmation of receipt) and confirmed
and shall be deemed given when so mailed, delivered or faxed, or if mailed, two days after such mailing. If to the Representative: Cantor Fitzgerald & Co. 499 Park Avenue New York, NY 10022 Attn: General Counsel Facsimile: (212) 829-4708 Copy (which copy shall not constitute notice) to: Ellenoff Grossman & Schole, LLP 1345 Avenue of the Americas New York, NY 10105 Attn: Stuart Neuhauser, Esq. Facsimile: (212) 370-7889 If to the Company: Harmony Merger Corp. Attn: Eric S. Rosenfeld Facsimile: Copy (which copy shall not constitute notice) to: Graubard Miller 10.2 Headings.
The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this Agreement. 10.3 Amendment.
This Agreement may only be amended by a written instrument executed by each of the parties hereto. 10.4 Entire
Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with this
Agreement) constitute the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and supersede
all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof. 10.5 Binding
Effect. This Agreement shall inure solely to the benefit of and shall be binding upon the Representative, the Underwriters, the
Company and the Controlling Persons, directors and officers referred to in Section 5 hereof, and their respective successors and
assigns and legal representatives, and no other person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Agreement or any provisions herein contained. The term “successors
and assigns” shall not include a purchaser, in its capacity as such, of securities from any of the Underwriters. The Company
acknowledges and agrees that: (i) the sale and issuance of the securities pursuant to this Agreement is an arm’s-length
commercial transaction between the Company and the Underwriters; (ii) in connection therewith and with the process leading to
the Offering, the Underwriters are acting solely as a principal and not the agent or fiduciary of the Company; (iii) no Underwriter
has assumed a fiduciary responsibility in favor of the Company with respect to the Offering or the process leading thereto, including
any negotiation related to the pricing of the securities; and (iv) the Company has consulted its own legal advisors to the extent
it has deemed appropriate in connection with this Agreement and the Offering. 10.6 Waiver
of Immunity. To the extent that the Company may be entitled in any jurisdiction in which judicial proceedings may at any time be
commenced hereunder, to claim for itself or its revenues or assets any immunity, including sovereign immunity, from suit, jurisdiction,
attachment in aid of execution of a judgment or prior to a judgment, execution of a judgment or any other legal process with respect
to its obligations hereunder and to the extent that in any such jurisdiction there may be attributed to the Company such an immunity
(whether or not claimed), the Company hereby irrevocably agrees not to claim and irrevocably waives such immunity to the maximum
extent permitted by law. 10.7 Submission
to Jurisdiction. The Company irrevocably submits to the nonexclusive jurisdiction of any New York State or United States Federal
court sitting in The City of New York, Borough of Manhattan, over any suit, action or proceeding arising out of or relating to
this Agreement, the Registration Statement, the Sale Preliminary Prospectus and the Prospectus or the offering of the Securities.
The Company irrevocably waives, to the fullest extent permitted by law, any objection that they may now or hereafter have to the
laying of venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding
brought in such a court has been brought in an inconvenient forum. Any such process or summons to be served upon the Company may
be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed
to it at the address set forth in Section 10.1 hereof. Such mailing shall be deemed personal service and shall be legal and binding
upon the Company in any action, proceeding or claim. The Company waives, to the fullest extent permitted by law, any other requirements
of or objections to personal jurisdiction with respect thereto. Notwithstanding the foregoing, any action based on this Agreement
may be instituted by the Underwriters in any competent court. The Company agrees that the prevailing party(ies) in any such action
shall be entitled to recover from the other party(ies) all of its reasonable attorneys’ fees and expenses relating to such
action or proceeding and/or incurred in connection with the preparation therefor. 10.8 Governing
Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without
giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. 10.9 Execution
in Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement,
and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of
the other parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf transmission shall constitute
valid and sufficient delivery thereof. 10.10 Waiver.
The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed or
construed to be a waiver of any such provision, nor to in any way affect the validity of this Agreement or any provision hereof
or the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach,
non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument
executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach,
non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance
or non-fulfillment. 10.11 No
Fiduciary Relationship. The Company hereby acknowledges that the Underwriters are acting solely as underwriters in connection with
the offering of the Public Securities. The Company further acknowledges that the Underwriters are acting pursuant to a contractual
relationship created solely by this Agreement entered into on an arm's length basis and in no event do the parties intend that
the Underwriters act or be responsible as a fiduciary to the Company, its management, shareholders, creditors or any other person
in connection with any activity that the Underwriters may undertake or have undertaken in furtherance of the offering of the Public
Securities, either before or after the date hereof. The Underwriters hereby expressly disclaim any fiduciary or similar obligations
to the Company, either in connection with the transactions contemplated by this Agreement or any matters leading up to such transactions,
and the Company hereby confirms its understanding and agreement to that effect. The Company and the Underwriters agree that they
are each responsible for making their own independent judgments with respect to any such transactions, and that any opinions or
views expressed by the Underwriters to the Company regarding such transactions, including but not limited to any opinions or views
with respect to the price or market for the Public Securities, do not constitute advice or recommendations to the Company. The
Company and the Underwriters agree that the Underwriters are acting as principal and not the agent or fiduciary of the Company,
and no Underwriter has assumed, and none of them will assume, any advisory responsibility in favor of the Company with respect
to the transactions contemplated hereby or the process leading thereto (irrespective of whether any Underwriter has advised or
is currently advising the Company on other matters). The Company hereby waives and releases, to the fullest extent permitted by
law, any claims that the Company may have against the Underwriters with respect to any breach or alleged breach of any fiduciary
or similar duty to the Company in connection with the transactions contemplated by this Agreement or any matters leading up to
such transactions [Remainder of page intentionally
left blank] If the foregoing correctly sets forth the understanding
between the Underwriters and the Company, please so indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement between us. HARMONY MERGER CORP. Accepted on the date first above written. CANTOR FITZGERALD & CO. [Signature page to Underwriting Agreement] SCHEDULE I HARMONY MERGER CORP. 10,000,000 Units EXHIBIT A FORM OF TARGET BUSINESS LETTER HARMONY MERGER CORP. Gentlemen: Reference is made to the Final Prospectus
of Harmony Merger Corp. (the “Company”), dated ________________, 2015 (the “Prospectus”).
Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Prospectus. We have read the Prospectus and understand
that the Company has established the Trust Account, initially in an amount of at least $102,000,000 for the benefit of the Public
Stockholders and the Underwriters of the Company’s initial public offering (the “Underwriters”)
and that, except for a portion of the interest earned on the amounts held in the Trust Account, the Company may disburse monies
from the Trust Account only: (i) to the Public Stockholders in the event they elect to redeem their public shares in connection
with the consummation of a Business Combination, (ii) to the Public Stockholders if the Company fails to consummate a Business
Combination within 24 months from the closing date of the Company’s initial public offering, or (iii) to the Company after
or concurrently with the consummation of a Business Combination. For and in consideration of the Company
agreeing to evaluate the undersigned for purposes of consummating a Business Combination with it, the undersigned hereby agrees
that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Account (each, a “Claim”)
and hereby waives any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements
with the Company and will not seek recourse against the Trust Account for any reason whatsoever. ___________________________________ Print Name of Target Business ___________________________________ Authorized Signature of Target Business EXHIBIT B FORM OF VENDOR LETTER HARMONY MERGER CORP. Gentlemen: Reference is made to the Final Prospectus
of Harmony Merger Corp. (the “Company”), dated ____________________, 2015 (the “Prospectus”).
Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Prospectus. We have read the Prospectus and understand
that the Company has established the Trust Account, initially in an amount of at least $102,000,000 for the benefit of the Public
Stockholders and the Underwriters of the Company’s initial public offering (the “Underwriters”)
and that, except for a portion of the interest earned on the amounts held in the Trust Account, the Company may disburse monies
from the Trust Account only: (i) to the Public Stockholders in the event they elect to redeem their public shares in connection
with the consummation of a Business Combination, (ii) to the Public Stockholders if the Company fails to consummate a Business
Combination within 24 months from the closing date of the Company’s initial public offering or (iii) to the Company after
or concurrently with the consummation of a Business Combination. For and in consideration of the Company
agreeing to engage the services of the undersigned, the undersigned hereby agrees that it does not have any right, title, interest
or claim of any kind in or to any monies in the Trust Account (each, a “Claim”) and hereby waives any Claim
it may have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against
the Trust Account for any reason whatsoever. _______________________________ Print Name of Vendor _______________________________ Authorized Signature of Vendor 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
1. That Marcum is registered with PCAOB;
2. That Marcum has sufficient assets and insurance to pay for any liability incurred by it relating to providing the letter; and
3. That Marcum is not insolvent. 32 33 34 35 36 37 38 39 40 41
777 Third Avenue, 37th Floor
New York, NY 10017
405 Lexington Avenue
New York, NY 10174
Attn: Jeffrey M. Gallant, Esq.
Facsimile: (212) 818-888142 43 44
Very truly yours,
By:
Name:
Title:
By:
Name:
Title:
45
Underwriter:
Number of Firm Units to be Purchased
CANTOR FITZGERALD & CO.
TOTAL
10,000,000
Exhibit 5.1
GRAUBARD MILLER
The Chrysler Building
405 Lexington Avenue
New York, New York 10174
January 21, 2015 |
Harmony Merger Corp.
777 Third Avenue, 37th Floor
New York, New York 10017
Dear Sirs:
Reference is made to the Registration Statement on Form S-1 (“Registration Statement”) filed by Harmony Merger Corp. (the “Company”), a Delaware corporation, under the Securities Act of 1933, as amended (“Act”), covering (i) 10,000,000 units (the “Firm Units”), each unit consisting of one share of the Company’s common stock, par value $.0001 per share (the “Common Stock”), and one redeemable warrant (“Warrant”), each Warrant to purchase three-fourths (3/4) of a share of Common Stock, representing a total of 10,000,000 shares of Common Stock and 10,000,000 Warrants, which the Company will sell to the underwriters (the “Underwriters”) for whom Cantor Fitzgerald & Co. is acting as representative, (ii) 1,500,000 units (the “Over-Allotment Units”), each unit identical to the units in the Firm Units, representing a total of 1,500,000 shares of Common Stock and 1,500,000 Warrants, which the Underwriters will have a right to purchase from the Company to cover over-allotments, if any, and (iii) all of the shares of Common Stock and Warrants included in the Firm Units and Over-Allotment Units.
We have examined such documents and considered such legal matters as we have deemed necessary and relevant as the basis for the opinion set forth below. With respect to such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as reproduced or certified copies, and the authenticity of the originals of those latter documents. As to questions of fact material to this opinion, we have, to the extent deemed appropriate, relied upon certain representations of certain officers and employees of the Company.
Based upon the foregoing, we are of the opinion that:
1. The Units, the Over-Allotment Units, the Warrants and the Common Stock to be sold to the Underwriters, when issued and sold in accordance with and in the manner described in the Registration Statement, will be duly authorized, validly issued, fully paid and non assessable.
2. The Warrants constitute legal, valid and binding obligations of the Company, enforceable against it in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.
Our opinions set forth herein are limited to the laws of the State of New York and the General Corporation Law of the State of Delaware and, to the extent that judicial or regulatory orders or decrees or consents, approvals, licenses, authorizations, validations, filings, recordings or registrations with governmental authorities are relevant, to those required under such laws (all of the foregoing being referred to as “Opined on Law”). We do not express any opinion with respect to the law of any jurisdiction other than Opined on Law.
We hereby consent to the use of this opinion as an exhibit to the Registration Statement, to the use of our name as your counsel and to all references made to us in the Registration Statement and in the Prospectus forming a part thereof. In giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Act, or the rules and regulations promulgated thereunder.
Very truly yours, | |
/s/ Graubard Miller |
Exhibit 10.6.1
Amended and Restated as of December 31, 2014
Harmony Merger Corp.
777 Third Avenue, 37th Floor
New York, New York 10017
Gentlemen:
This letter agreement amends and restates the letter agreement (the “Original Agreement”) dated June 23, 2014 among Harmony Merger Corp. (the “Corporation”), the undersigned and Graubard Miller (“GM”), counsel to the Corporation, in its entirety and the Original Agreement shall be deemed to have been superseded and replaced in their entirety by this letter agreement.
The Corporation, a blank check company formed for the purpose of acquiring one or more businesses or entities (a “Business Combination”), intends to register its securities under the Securities Act of 1933, as amended (“Securities Act”), in connection with its initial public offering (“IPO”).
The undersigned commits to purchase an aggregate of 55,871 units of the Corporation (“Insider Units”), each Insider Unit consisting of one share of Common Stock and one warrant (“Warrant”) to purchase, in the five years following a Business Combination, three-fourths (3/4) of one share of Common Stock for $11.50 per whole share, for an aggregate purchase price of $558,710 (the “Initial Purchase Price”). Additionally, if the underwriters in the IPO exercise their over-allotment option in full or part, the undersigned further commits to purchase up to an additional 100 Insider Units at $10.00 per Insider Unit for an aggregate purchase price of $1,000 (the “Over-Allotment Purchase Price” and together with the Initial Purchase Price, the “Purchase Price”). At least 24 hours prior to the effective date of the Registration Statement (defined below), the undersigned will cause the Purchase Price to be delivered to Graubard Miller (“GM”), counsel for the Corporation, to hold in a non-interest bearing account until the Corporation consummates the IPO.
The consummation of the purchase and issuance of the Insider Units shall occur simultaneously with the consummation of the IPO and over-allotment option, as applicable. Simultaneously with the consummation of the IPO, GM shall deposit the Initial Purchase Price, without interest or deduction, into the trust fund (“Trust Fund”) established by the Corporation for the benefit of the Corporation’s public stockholders as described in the Corporation’s registration statement filed in connection with the IPO (“Registration Statement”). Simultaneously with the consummation of all or any part of the over-allotment option, GM shall deposit the pro-rata portion of the Over-Allotment Purchase Price, based upon the amount of the over-allotment option that has been exercised, without interest or deduction, into the Trust Fund. Upon expiration of the over-allotment option, GM shall return any unused portion of the Over-Allotment Purchase Price to the undersigned. If the Corporation does not complete the IPO on or before December 23, 2014 (subject to a six (6) month extension at the Corporation’s option in its sole discretion), the Purchase Price (plus interest earned thereon) will be returned to the undersigned.
Each of the Corporation and the undersigned acknowledges and agrees that GM is serving hereunder solely as a convenience to the parties to facilitate the purchase of the Insider Units and GM’s sole obligation under this letter agreement is to act with respect to holding and disbursing the Purchase Price for the Insider Units as described above. GM shall not be liable to the Corporation or the undersigned or any other person or entity in respect of any act or failure to act hereunder or otherwise in connection with performing its services hereunder unless GM has acted in a manner constituting gross negligence or willful misconduct. The Corporation shall indemnify GM against any claim made against it (including reasonable attorney’s fees) by reason of it acting or failing to act in connection with this letter agreement except as a result of its gross negligence or willful misconduct. GM may rely and shall be protected in acting or refraining from acting upon any written notice, instruction or request furnished to it hereunder and believed by it to be genuine and to have been signed or presented by the proper party or parties. Notwithstanding anything to the contrary contained herein, GM agrees that it does not have any right, title, interest or claim of any kind in or to any monies of the Trust Fund (“Claim”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against the Trust Fund for any reason whatsoever.
The Insider Shares will be identical to the shares of Common Stock included in the units to be sold by the Corporation in the IPO, and the Insider Units will be identical to the units to be sold by the Corporation in the IPO, except that:
● | the undersigned agrees to vote the Insider Shares and shares of Common Stock included in the Insider Units in favor of any proposed Business Combination; |
● | all Insider Shares (including those held by other Holders (as defined below) will be placed in escrow, subject to the terms of an escrow agreement reasonably acceptable to the undersigned, and will not be released (subject to certain exceptions) until (A) the earlier of one year after the completion of a Business Combination and the date on which the closing price of the Common Stock exceeds $12.50 for any 20 trading days within a 30-trading day period following the completion of a Business Combination with respect to 50% of the Insider Shares and (B) one year after the completion of a Business Combination with respect to the remaining 50% of the Insider Shares, and may only be transferred during this time period (i) amongst the initial purchasers of the Insider Shares, to the Corporation’s officers, directors and employees, to a holder’s affiliates, or to its members upon its liquidation, (ii) to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent and distribution upon death, (iv) pursuant to a qualified domestic relations order, (v) by private sales made in connection with the consummation of a Business Combination at prices no greater than the price at which the Insider Shares were originally purchased or (vi) to the Corporation for cancellation in connection with the consummation of a Business Combination, in each case (except for clause (vi)) where the transferee agrees to the terms of the escrow agreement and the voting requirements set forth above); |
2 |
● | all Insider Units and underlying securities (including Insider Units and underlying securities held by other Holders) will not be transferable (except (i) amongst the initial purchasers of the Insider Shares, to the Corporation’s officers, directors and employees, to a holder’s affiliates, or to its members upon its liquidation, (ii) to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent and distribution upon death, (iv) pursuant to a qualified domestic relations order, (v) by private sales made in connection with the consummation of a Business Combination at prices no greater than the price at which the Insider Units were originally purchased or (vi) to the Corporation for cancellation in connection with the consummation of a Business Combination, in each case (except for clause (vi)) where the transferee agrees to the terms of the transfer restrictions) until after the completion of a Business Combination; |
● | the Insider Shares and Insider Units will be subject to customary registration rights, which shall be described in the Registration Statement; |
● | the undersigned will not participate in any liquidation distribution with respect to the Insider Shares or Insider Units (but will participate in liquidation distributions with respect to any units or shares of Common Stock purchased by the undersigned in the IPO or in the open market) if the Corporation fails to consummate a Business Combination; and |
● | the Insider Shares and Insider Units will include any additional terms or restrictions as is customary in other similarly structured blank check company offerings or as may be reasonably required by the underwriters in the IPO in order to consummate the IPO, each of which will be set forth in the Registration Statement. |
The Company also agrees that so long as the Warrants included in the Private Units continue to be held by the undersigned or its permitted transferees, the Company will not redeem such Warrants and will permit the undersigned or its permitted transferees to exercise such Warrants on a cashless basis by surrendering such Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference between the exercise price of the Warrants and the “Fair Market Value” by (y) the Fair Market Value; provided, however, that no cashless exercise shall be permitted unless the Fair Market Value is higher than the exercise price. Solely for purposes of this agreement, the “Fair Market Value” shall mean the average reported last sale price of the Common Stock for the 10 trading days ending on the day prior to the Company’s receipt of the applicable exercise notice. Additionally, because the Warrants included in the Private Units are being issued in a private transaction, they may be exercisable by the undersigned or its permitted transferees for unregistered ordinary shares even if the prospectus relating to the ordinary shares issuable upon exercise of the Warrants is not current and effective.
3 |
Each of the undersigned and the Corporation acknowledges and agrees that, in order to consummate any Business Combination, the holders of Insider Shares or Insider Units (“Holders”) may be required to contribute back to the capital of the Corporation a portion of any such securities for cancellation and that such contributions will occur as follows:
● | first, all Holders other than DKU 2013 LLC, The K2 Principal Fund L.P., NPIC Limited, Covalent Capital Partners Master Fund, L.P., Jeff Hastings, and Leonard Schlemm (collectively, the “Sponsor Group”), until all Holders have the same ratio of Insider Shares to Insider Units; and | |
● | second, all Holders including the members of the Sponsor Group, pro rata based on the number of Insider Shares or Insider Units, as applicable, held by each Holder after giving effect to (i) above, such that in all cases the ratio of Insider Shares to Insider Units is equal. |
Notwithstanding anything to the contrary contained herein, the undersigned’s liability arising out of or related to this letter agreement shall not exceed the Purchase Price.
The undersigned acknowledges and agrees that it will execute agreements in form and substance typical for transactions of this nature necessary to effectuate the foregoing agreements and obligations prior to the consummation of the IPO as are reasonably acceptable to the undersigned, including but not limited to (i) an insider letter, (ii) an escrow agreement and (iii) a registration rights agreement.
The undersigned hereby represents and warrants that, as applicable:
(a) | it has been advised that the Insider Shares and Insider Units have not been registered under the Securities Act; |
(b) | it is acquiring the Insider Shares and Insider Units for its account for investment purposes only; |
(c) | it has no present intention of selling or otherwise disposing of the Insider Shares and Insider Units in violation of the securities laws of the United States; |
(d) | it is an “accredited investor” as defined by Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended; |
(e) | it has had both the opportunity to ask questions and receive answers from the officers and directors of the Corporation and all persons acting on its behalf concerning the terms and conditions of the offer made hereunder; and |
(f) | it is familiar with the proposed business, management, financial condition and affairs of the Corporation. |
(g) | it has full power, authority and legal capacity to execute and deliver this letter and any documents contemplated herein or needed to consummate the transactions contemplated in this letter; and |
(h) | this letter constitutes its respective legal, valid and binding obligation, and is enforceable against it. |
-the remainder of this page is intentionally left blank-
4 |
Very truly yours, | |
/s/ Eric S. Rosenfeld | |
Eric S. Rosenfeld |
Accepted and Agreed: | ||
Harmony Merger Corp. | ||
By: | /s/ David D. Sgro | |
Name: David D. Sgro | ||
Title: Chief Operating Officer | ||
Graubard Miller | ||
(solely with respect to its obligations to hold | ||
and disburse monies for the Insider Units) | ||
By: | /s/ Jeffrey M. Gallant | |
Name: Jeffrey M. Gallant | ||
Title: Partner |
5
Exhibit 10.6.2
December 31, 2014
Harmony Merger Corp.
777 Third Avenue, 37th Floor
New York, New York 10017
Gentlemen:
Harmony Merger Corp. (“Corporation”), a blank check company formed for the purpose of acquiring one or more businesses or entities (a “Business Combination”), intends to register its securities under the Securities Act of 1933, as amended (“Securities Act”), in connection with its initial public offering (“IPO”).
The undersigned hereby commits that he will purchase an aggregate of 2,538 units of the Corporation (“Insider Units”), each Insider Unit consisting of one share of Common Stock and one warrant (“Warrant”) to purchase three-fourths of one share of Common Stock for $11.50 per whole share, for an aggregate purchase price of $25,380 (the “Purchase Price”). At least 24 hours prior to the effective date of the Registration Statement (defined below), the undersigned will cause the Purchase Price to be delivered to Graubard Miller (“GM”), counsel for the Corporation, to hold in a non-interest bearing account until the Corporation consummates the IPO. The consummation of the purchase and issuance of the Insider Units shall occur simultaneously with the consummation of the IPO. Simultaneously with the consummation of the IPO, GM shall deposit the Purchase Price, without interest or deduction, into the trust fund (“Trust Fund”) established by the Corporation for the benefit of the Corporation’s public stockholders as described in the Corporation’s registration statement filed in connection with the IPO (“Registration Statement”).
The Insider Units will be identical to the units to be sold by the Corporation in the IPO, except that:
● | the undersigned agrees to vote the shares of Common Stock included in the Insider Units in favor of any proposed Business Combination; | |
● | the Insider Units and underlying securities will not be transferable (except (i) amongst the initial purchasers of the Insider Units, to the Corporation’s officers, directors and employees, to a holder’s affiliates, or to its members upon its liquidation, (ii) to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent and distribution upon death, (iv) pursuant to a qualified domestic relations order, (v) by private sales made in connection with the consummation of a Business Combination at prices no greater than the price at which the Insider Units were originally purchased or (vi) to the Corporation for cancellation in connection with the consummation of a Business Combination, in each case (except for clause (vi)) where the transferee agrees to the terms of the transfer restrictions and voting agreement set forth above) until after the completion of a Business Combination; | |
● | the Insider Units will be subject to customary registration rights, which shall be described in the Registration Statement; |
● | the undersigned will not participate in any liquidation distribution with respect to the Insider Units (but will participate in liquidation distributions with respect to any units or shares of Common Stock purchased by the undersigned in the IPO or in the open market) if the Corporation fails to consummate a Business Combination; and | |
● | the Insider Units will include any additional terms or restrictions as is customary in other similarly structured blank check company offerings or as may be reasonably required by the underwriters in the IPO in order to consummate the IPO, each of which will be set forth in the Registration Statement. |
The Company also agrees that so long as the Warrants included in the Private Units continue to be held by the undersigned or its permitted transferees, the Company will not redeem such Warrants and will permit the undersigned or its permitted transferees to exercise such Warrants on a cashless basis by surrendering such Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference between the exercise price of the Warrants and the “Fair Market Value” by (y) the Fair Market Value; provided, however, that no cashless exercise shall be permitted unless the Fair Market Value is higher than the exercise price. Solely for purposes of this agreement, the “Fair Market Value” shall mean the average reported last sale price of the Common Stock for the 10 trading days ending on the day prior to the Company’s receipt of the applicable exercise notice. Additionally, because the Warrants included in the Private Units are being issued in a private transaction, they may be exercisable by the undersigned or its permitted transferees for unregistered ordinary shares even if the prospectus relating to the ordinary shares issuable upon exercise of the Warrants is not current and effective.
Each of the Corporation and the undersigned acknowledges and agrees that GM is serving hereunder solely as a convenience to the parties to facilitate the purchase of the Insider Units and GM’s sole obligation under this letter agreement is to act with respect to holding and disbursing the Purchase Price for the Insider Units as described above. GM shall not be liable to the Corporation or the undersigned or any other person or entity in respect of any act or failure to act hereunder or otherwise in connection with performing its services hereunder unless GM has acted in a manner constituting gross negligence or willful misconduct. The Corporation shall indemnify GM against any claim made against it (including reasonable attorney’s fees) by reason of it acting or failing to act in connection with this letter agreement except as a result of its gross negligence or willful misconduct. GM may rely and shall be protected in acting or refraining from acting upon any written notice, instruction or request furnished to it hereunder and believed by it to be genuine and to have been signed or presented by the proper party or parties. Notwithstanding anything to the contrary contained herein, GM agrees that it does not have any right, title, interest or claim of any kind in or to any monies of the Trust Fund (“Claim”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against the Trust Fund for any reason whatsoever.
The undersigned further acknowledges and agrees that if, in order to consummate any Business Combination, the holders of Insider Units are required to contribute back to the capital of the Corporation a portion of any such securities to be cancelled by the Corporation, the undersigned will contribute back to the capital of the Corporation a proportionate number of Insider Units pro rata with the other holders of Insider Units.
2 |
The undersigned acknowledges and agrees that it will execute agreements in form and substance typical for transactions of this nature necessary to effectuate the foregoing agreements and obligations prior to the consummation of the IPO as are reasonably acceptable to the undersigned, including but not limited to (i) an insider letter, (ii) an escrow agreement and (iii) a registration rights agreement.
The undersigned hereby represents and warrants that:
(a) | it has been advised that the Insider Units have not been registered under the Securities Act; | |
(b) | it is acquiring the Insider Units for its account for investment purposes only; | |
(c) | it has no present intention of selling or otherwise disposing of the Insider Units in violation of the securities laws of the United States; | |
(d) | it is an “accredited investor” as defined by Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended; | |
(e) | it has had both the opportunity to ask questions and receive answers from the officers and directors of the Corporation and all persons acting on its behalf concerning the terms and conditions of the offer made hereunder; and | |
(f) | it is familiar with the proposed business, management, financial condition and affairs of the Corporation. | |
(g) | it has full power, authority and legal capacity to execute and deliver this letter and any documents contemplated herein or needed to consummate the transactions contemplated in this letter; and | |
(h) | this letter constitutes its respective legal, valid and binding obligation, and is enforceable against it. |
3 |
Very truly yours, | |||
/s/ David D. Sgro | |||
David D. Sgro | |||
Accepted and Agreed: | |||
Harmony Merger Corp. | |||
By: | /s/ Eric S. Rosenfeld | ||
Name: Eric S. Rosenfeld | |||
Title: Chief Executive Officer |
4
Exhibit 10.6.3
December 31, 2014
Harmony Merger Corp.
777 Third Avenue, 37th Floor
New York, New York 10017
Gentlemen:
Harmony Merger Corp. (“Corporation”), a blank check company formed for the purpose of acquiring one or more businesses or entities (a “Business Combination”), intends to register its securities under the Securities Act of 1933, as amended (“Securities Act”), in connection with its initial public offering (“IPO”).
The undersigned hereby commits that he will purchase an aggregate of 1,099 units of the Corporation (“Insider Units”), each Insider Unit consisting of one share of Common Stock and one warrant (“Warrant”) to purchase three-fourths of one share of Common Stock for $11.50 per whole share, for an aggregate purchase price of $10,990 (the “Purchase Price”). At least 24 hours prior to the effective date of the Registration Statement (defined below), the undersigned will cause the Purchase Price to be delivered to Graubard Miller (“GM”), counsel for the Corporation, to hold in a non-interest bearing account until the Corporation consummates the IPO. The consummation of the purchase and issuance of the Insider Units shall occur simultaneously with the consummation of the IPO. Simultaneously with the consummation of the IPO, GM shall deposit the Purchase Price, without interest or deduction, into the trust fund (“Trust Fund”) established by the Corporation for the benefit of the Corporation’s public stockholders as described in the Corporation’s registration statement filed in connection with the IPO (“Registration Statement”).
The Insider Units will be identical to the units to be sold by the Corporation in the IPO, except that:
● | the undersigned agrees to vote the shares of Common Stock included in the Insider Units in favor of any proposed Business Combination; | |
● | the Insider Units and underlying securities will not be transferable (except (i) amongst the initial purchasers of the Insider Units, to the Corporation’s officers, directors and employees, to a holder’s affiliates, or to its members upon its liquidation, (ii) to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent and distribution upon death, (iv) pursuant to a qualified domestic relations order, (v) by private sales made in connection with the consummation of a Business Combination at prices no greater than the price at which the Insider Units were originally purchased or (vi) to the Corporation for cancellation in connection with the consummation of a Business Combination, in each case (except for clause (vi)) where the transferee agrees to the terms of the transfer restrictions and voting agreement set forth above) until after the completion of a Business Combination; | |
● | the Insider Units will be subject to customary registration rights, which shall be described in the Registration Statement; |
● | the undersigned will not participate in any liquidation distribution with respect to the Insider Units (but will participate in liquidation distributions with respect to any units or shares of Common Stock purchased by the undersigned in the IPO or in the open market) if the Corporation fails to consummate a Business Combination; and | |
● | the Insider Units will include any additional terms or restrictions as is customary in other similarly structured blank check company offerings or as may be reasonably required by the underwriters in the IPO in order to consummate the IPO, each of which will be set forth in the Registration Statement. |
The Company also agrees that so long as the Warrants included in the Private Units continue to be held by the undersigned or its permitted transferees, the Company will not redeem such Warrants and will permit the undersigned or its permitted transferees to exercise such Warrants on a cashless basis by surrendering such Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference between the exercise price of the Warrants and the “Fair Market Value” by (y) the Fair Market Value; provided, however, that no cashless exercise shall be permitted unless the Fair Market Value is higher than the exercise price. Solely for purposes of this agreement, the “Fair Market Value” shall mean the average reported last sale price of the Common Stock for the 10 trading days ending on the day prior to the Company’s receipt of the applicable exercise notice. Additionally, because the Warrants included in the Private Units are being issued in a private transaction, they may be exercisable by the undersigned or its permitted transferees for unregistered ordinary shares even if the prospectus relating to the ordinary shares issuable upon exercise of the Warrants is not current and effective.
Each of the Corporation and the undersigned acknowledges and agrees that GM is serving hereunder solely as a convenience to the parties to facilitate the purchase of the Insider Units and GM’s sole obligation under this letter agreement is to act with respect to holding and disbursing the Purchase Price for the Insider Units as described above. GM shall not be liable to the Corporation or the undersigned or any other person or entity in respect of any act or failure to act hereunder or otherwise in connection with performing its services hereunder unless GM has acted in a manner constituting gross negligence or willful misconduct. The Corporation shall indemnify GM against any claim made against it (including reasonable attorney’s fees) by reason of it acting or failing to act in connection with this letter agreement except as a result of its gross negligence or willful misconduct. GM may rely and shall be protected in acting or refraining from acting upon any written notice, instruction or request furnished to it hereunder and believed by it to be genuine and to have been signed or presented by the proper party or parties. Notwithstanding anything to the contrary contained herein, GM agrees that it does not have any right, title, interest or claim of any kind in or to any monies of the Trust Fund (“Claim”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against the Trust Fund for any reason whatsoever.
The undersigned further acknowledges and agrees that if, in order to consummate any Business Combination, the holders of Insider Units are required to contribute back to the capital of the Corporation a portion of any such securities to be cancelled by the Corporation, the undersigned will contribute back to the capital of the Corporation a proportionate number of Insider Units pro rata with the other holders of Insider Units.
2 |
The undersigned acknowledges and agrees that it will execute agreements in form and substance typical for transactions of this nature necessary to effectuate the foregoing agreements and obligations prior to the consummation of the IPO as are reasonably acceptable to the undersigned, including but not limited to (i) an insider letter, (ii) an escrow agreement and (iii) a registration rights agreement.
The undersigned hereby represents and warrants that:
(a) | it has been advised that the Insider Units have not been registered under the Securities Act; | |
(b) | it is acquiring the Insider Units for its account for investment purposes only; | |
(c) | it has no present intention of selling or otherwise disposing of the Insider Units in violation of the securities laws of the United States; | |
(d) | it is an “accredited investor” as defined by Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended; | |
(e) | it has had both the opportunity to ask questions and receive answers from the officers and directors of the Corporation and all persons acting on its behalf concerning the terms and conditions of the offer made hereunder; and | |
(f) | it is familiar with the proposed business, management, financial condition and affairs of the Corporation. | |
(g) | it has full power, authority and legal capacity to execute and deliver this letter and any documents contemplated herein or needed to consummate the transactions contemplated in this letter; and | |
(h) | this letter constitutes its respective legal, valid and binding obligation, and is enforceable against it. |
3 |
Very truly yours, | |||
/s/ Greg Monahan | |||
Greg Monahan | |||
Accepted and Agreed: | |||
Harmony Merger Corp. | |||
By: | /s/ Eric S. Rosenfeld | ||
Name: Eric S. Rosenfeld | |||
Title: Chief Executive Officer |
4
Exhibit 10.6.4
December 31, 2014 |
Harmony Merger Corp.
777 Third Avenue, 37th Floor
New York, New York 10017
Gentlemen:
Harmony Merger Corp. (“Corporation”), a blank check company formed for the purpose of acquiring one or more businesses or entities (a “Business Combination”), intends to register its securities under the Securities Act of 1933, as amended (“Securities Act”), in connection with its initial public offering (“IPO”).
The undersigned hereby commits that he will purchase an aggregate of 492 units of the Corporation (“Insider Units”), each Insider Unit consisting of one share of Common Stock and one warrant (“Warrant”) to purchase three-fourths of one share of Common Stock for $11.50 per whole share, for an aggregate purchase price of $4,920 (the “Purchase Price”). At least 24 hours prior to the effective date of the Registration Statement (defined below), the undersigned will cause the Purchase Price to be delivered to Graubard Miller (“GM”), counsel for the Corporation, to hold in a non-interest bearing account until the Corporation consummates the IPO. The consummation of the purchase and issuance of the Insider Units shall occur simultaneously with the consummation of the IPO. Simultaneously with the consummation of the IPO, GM shall deposit the Purchase Price, without interest or deduction, into the trust fund (“Trust Fund”) established by the Corporation for the benefit of the Corporation’s public stockholders as described in the Corporation’s registration statement filed in connection with the IPO (“Registration Statement”).
The Insider Units will be identical to the units to be sold by the Corporation in the IPO, except that:
· | the undersigned agrees to vote the shares of Common Stock included in the Insider Units in favor of any proposed Business Combination; |
· | the Insider Units and underlying securities will not be transferable (except (i) amongst the initial purchasers of the Insider Units, to the Corporation’s officers, directors and employees, to a holder’s affiliates, or to its members upon its liquidation, (ii) to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent and distribution upon death, (iv) pursuant to a qualified domestic relations order, (v) by private sales made in connection with the consummation of a Business Combination at prices no greater than the price at which the Insider Units were originally purchased or (vi) to the Corporation for cancellation in connection with the consummation of a Business Combination, in each case (except for clause (vi)) where the transferee agrees to the terms of the transfer restrictions and voting agreement set forth above) until after the completion of a Business Combination; |
· | the Insider Units will be subject to customary registration rights, which shall be described in the Registration Statement; |
· | the undersigned will not participate in any liquidation distribution with respect to the Insider Units (but will participate in liquidation distributions with respect to any units or shares of Common Stock purchased by the undersigned in the IPO or in the open market) if the Corporation fails to consummate a Business Combination; and |
· | the Insider Units will include any additional terms or restrictions as is customary in other similarly structured blank check company offerings or as may be reasonably required by the underwriters in the IPO in order to consummate the IPO, each of which will be set forth in the Registration Statement. |
The Company also agrees that so long as the Warrants included in the Private Units continue to be held by the undersigned or its permitted transferees, the Company will not redeem such Warrants and will permit the undersigned or its permitted transferees to exercise such Warrants on a cashless basis by surrendering such Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference between the exercise price of the Warrants and the “Fair Market Value” by (y) the Fair Market Value; provided, however, that no cashless exercise shall be permitted unless the Fair Market Value is higher than the exercise price. Solely for purposes of this agreement, the “Fair Market Value” shall mean the average reported last sale price of the Common Stock for the 10 trading days ending on the day prior to the Company’s receipt of the applicable exercise notice. Additionally, because the Warrants included in the Private Units are being issued in a private transaction, they may be exercisable by the undersigned or its permitted transferees for unregistered ordinary shares even if the prospectus relating to the ordinary shares issuable upon exercise of the Warrants is not current and effective.
Each of the Corporation and the undersigned acknowledges and agrees that GM is serving hereunder solely as a convenience to the parties to facilitate the purchase of the Insider Units and GM’s sole obligation under this letter agreement is to act with respect to holding and disbursing the Purchase Price for the Insider Units as described above. GM shall not be liable to the Corporation or the undersigned or any other person or entity in respect of any act or failure to act hereunder or otherwise in connection with performing its services hereunder unless GM has acted in a manner constituting gross negligence or willful misconduct. The Corporation shall indemnify GM against any claim made against it (including reasonable attorney’s fees) by reason of it acting or failing to act in connection with this letter agreement except as a result of its gross negligence or willful misconduct. GM may rely and shall be protected in acting or refraining from acting upon any written notice, instruction or request furnished to it hereunder and believed by it to be genuine and to have been signed or presented by the proper party or parties. Notwithstanding anything to the contrary contained herein, GM agrees that it does not have any right, title, interest or claim of any kind in or to any monies of the Trust Fund (“Claim”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against the Trust Fund for any reason whatsoever.
The undersigned further acknowledges and agrees that if, in order to consummate any Business Combination, the holders of Insider Units are required to contribute back to the capital of the Corporation a portion of any such securities to be cancelled by the Corporation, the undersigned will contribute back to the capital of the Corporation a proportionate number of Insider Units pro rata with the other holders of Insider Units.
2 |
The undersigned acknowledges and agrees that it will execute agreements in form and substance typical for transactions of this nature necessary to effectuate the foregoing agreements and obligations prior to the consummation of the IPO as are reasonably acceptable to the undersigned, including but not limited to (i) an insider letter, (ii) an escrow agreement and (iii) a registration rights agreement.
The undersigned hereby represents and warrants that:
(a) | it has been advised that the Insider Units have not been registered under the Securities Act; |
(b) | it is acquiring the Insider Units for its account for investment purposes only; |
(c) | it has no present intention of selling or otherwise disposing of the Insider Units in violation of the securities laws of the United States; |
(d) | it is an “accredited investor” as defined by Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended; |
(e) | it has had both the opportunity to ask questions and receive answers from the officers and directors of the Corporation and all persons acting on its behalf concerning the terms and conditions of the offer made hereunder; and | |
(f) | it is familiar with the proposed business, management, financial condition and affairs of the Corporation. |
(g) | it has full power, authority and legal capacity to execute and deliver this letter and any documents contemplated herein or needed to consummate the transactions contemplated in this letter; and | |
(h) | this letter constitutes its respective legal, valid and binding obligation, and is enforceable against it. |
3 |
Very truly yours, | |
/s/ Tom Kobylarz | |
Tom Kobylarz |
Accepted and Agreed: | ||
Harmony Merger Corp. | ||
By: | /s/ Eric S. Rosenfeld | |
Name: Eric S. Rosenfeld | ||
Title: Chief Executive Officer |
4
Exhibit 10.9
January __, 2015
Harmony Merger Corp.
777 Third Avenue, 37th Floor
New York, New York 10017
Gentlemen:
Reference is made to the undersigned’s commitment letter (“Commitment Letter”) with Harmony Merger Corp. (the “Corporation”) set forth as an exhibit to the Corporation’s Registration Statement on Form S-1 (SEC File No. 333-197330) relating to the Corporation’s initial public offering of securities.
The undersigned confirms that, for so long as the undersigned’s Insider Shares or Insider Units (as such terms are defined in the Commitment Letter), as applicable, remain subject to the terms, restrictions and agreements of the Commitment Letter, prior to transferring any of the such Insider Shares or Insider Units, respectively, the transferee will be required to execute a letter agreement acknowledging that such transferee is bound by the then applicable terms, restrictions and agreements that the undersigned was originally bound by with respect to the Insider Shares and Insider Units, respectively.
Very truly yours, | ||
[HOLDER] | ||
By: | ||
Name: | ||
Title: |
Exhibit 23.1
Independent Registered Public Accounting Firm’s Consent
We consent to the inclusion in this Registration Statement of Harmony Merger Corp. (the Company) on Amendment No. 5 to Form S-1, File No. 333-197330, of our report dated July 9, 2014, except for Note 3 as to which the date is October 10, 2014 and Notes 1, 6 and 7 as to which the date is November 26, 2014, which includes an explanatory paragraph as to the Companys ability to continue as a going concern, with respect to our audit of the financial statements of Harmony Merger Corp. as of May 31, 2014 and for the period from May 21, 2014 (inception) through May 31, 2014, which report appears in the Prospectus, which is part of this Registration Statement. We also consent to the reference to our Firm under the heading Experts in such Prospectus.
/s/ Marcum llp
Marcum llp
New York ,NY
January 21, 2015